RESEARCH ALERT-Julius Baer downgrades Hyflux to hold

SINGAPORE Dec 2 (Reuters) - Julius Baer has downgraded water treatment firm Hyflux Ltd to hold from buy and cut its target price to S$1.30 from S$2.30.

STATEMENT:

Julius Baer has cut its rating for Hyflux to reflect its disappointing third quarter earnings and a stagnanat order book.

Hyflux posted in November a 34 percent fall in its third-quarter net profit, hurt by lower contributions from the Middle East and North Africa.

"We believe that Hyflux will face challenges in winning projects to catalyse its share price due to its current stretched balance sheet," Julius Baer said in a report.

It also noted that the company was re-focusing its efforts from the Middle East to Asia, namely in Singapore and China, where the poltical climate is more stable.

At 0601 GMT, shares of Hyflux were 0.83 percent lower at S$1.20, and have fallen about 48 percent since the start of the year. (Reporting by Charmian Kok)