STOCKS NEWS SINGAPORE-CIMB cuts Biosensors target price
CIMB Research cut its target price for medical device maker Biosensors International Group Ltd to S$1.79 from S$1.82 and kept its 'outperform' rating, citing risks of weaker licensing income from Japan and potential price cuts in other countries.
Biosensors shares were down 1.3 percent at S$1.125, and have plunged 21 percent since the start of the year, compared with the 26 percent rise in the FTSE ST Mid Cap Index.
Biosensors said on Wednesday its second-quarter net profit rose 22.7 percent to $28.2 million from a year earlier, helped by higher product revenue.
The brokerage cut its earnings estimates for Biosensors for 2013, but noted that its product profitability remains strong and valuations are at an attractive low level.
CIMB said Terumo Corp, which licenses Biosensors' drug-eluting stent technology for a royalty fee, has stated that it will be fighting to claw back market share lost, which should offer respite to Biosensors' licensing revenue.
Biosensors maintained its expectations that 2013 revenue will grow at 20-30 percent, as a royalty agreement negotiated with Terumo should offset competition and any mandatory price cut, CIMB said.
0904 (0104 GMT)
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