STOCKS NEWS SINGAPORE-CIMB cuts Sakari Resources
CIMB Research downgraded Singapore-listed coal producer Sakari Resources Ltd to underperform from neutral and cut its target price to S$1.01 from S$1.96, citing prolonged coal price weakness.
Sakari shares were up 0.8 percent at S$1.265 on Tuesday. The stock has fallen about 31 percent so far this year versus the 17 percent gain in the FT ST Midcap Index.
CIMB slashed its earnings per share estimates for Sakari's 2012-2014 fiscal years by 16-51 percent on lower average selling price and volume assumptions.
It also trimmed its 2012-2013 volume projections by 3-4 percent as it expects Sakari to scale back on production amid weak market pricing.
"Today, the industry grapples not only with a cyclical pullback in demand but also a structural shift in energy consumption patterns given the emergence of cheap shale gas. A shift towards shale gas threatens to marginalise demand for thermal coal."
0923 (0123 GMT) (Reporting by Eveline Danubrata in Singapore; firstname.lastname@example.org)
09:02 STOCKS NEWS SINGAPORE-OCBC, Maybank downgrade Raffles Medical
OCBC Investment Research and Maybank Kim Eng downgraded Singapore healthcare service provider Raffles Medical Group Ltd , citing smaller potential upside from the current share price level after a recent surge.
Raffles shares have risen around 17 percent so far this month, outperforming the 2 percent gain in the FT ST Midcap Index.
"We believe this has been buoyed largely by positive sentiment from the impending dual-listing of IHH Healthcare Berhad," OCBC said, adding that Raffles' defensive earnings quality is attractive to investors amid the global volatility.
IHH, the healthcare arm of Malaysia's state investor Khazanah Nasional Bhd, will debut on the Malaysian and Singapore bourses on July 25.
OCBC said Raffles' second-quarter net profit slightly missed forecasts due to higher-than-expected cost pressures. Raffles' net margin fell to 16.1 percent in the quarter from 17.4 percent a year earlier, it noted.
OCBC downgraded Raffles to hold from buy and lowered its target price to S$2.63 from S$2.73.
Maybank expects Raffles to raise prices in the range of 10-20 percent in the coming quarters and it forecast net margins for the 2012 fiscal year to come in at 17.2 percent, about 1.3 percentage points lower than in 2011.
The broker downgraded Raffles to hold from buy but kept its target price of S$2.71.
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0859 (0059 GMT) (Reporting by Eveline Danubrata in Singapore; email@example.com)
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