July 31, 2012 / 3:41 AM / 7 years ago

STOCKS NEWS SINGAPORE-Sakari Resources up after Q2 result

Shares of Sakari Resources Ltd rose to the highest in nearly two weeks after the coal producer posted a 66 percent increase in its second-quarter net profit from the previous three months on the back of lower costs and higher output.

Sakari shares gained as much as 4.7 percent to S$1.33, the strongest level since July 19. Sakari stock has fallen 28 percent so far this year.

Nearly 28 million Sakari shares changed hands, 1.2 times the average full-day volume over the past 30 days. Sakari was among the top traded stocks by both value and volume in the Singapore market.

The company turned in net profit of $23.9 million for the quarter ended June, up from $14.5 million in the preceding three months. But net profit fell 39 percent from a year earlier.

“Year-on-year, coal prices had fallen quite a lot and we had expected the weaker performance. But the quarter-on-quarter improvement was actually a lot stronger than what we expected,” said Carey Wong, an analyst at OCBC Investment Research.

“The key reasons for the improvement in margins is that they managed to sustain the average selling prices, and they have also managed to reduce cash costs slightly faster than what we expected.”

1135 (0335 GMT) (Reporting by Eveline Danubrata in Singapore; eveline.danubrata@thomsonreuters.com)

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11:18 STOCKS NEWS SINGAPORE-Deutsche cuts COSCO, Yangzijiang target prices

Deutsche Bank cut its target prices for COSCO Corp Singapore Ltd and Yangzijiang, citing poor outlook for the Chinese shipbuilding sector.

Shares of Yangzijiang were 0.5 percent lower at S$1.005 by 0305 GMT. They have risen 10.4 percent so far this year. COSCO was down 0.5 percent at S$0.955. It has gained 9 percent this year, compared with the FT ST Industrial Index’s 13.7 percent rise.

“Operating conditions and outlook in the Chinese shipbuilding sector remain challenging,” due to declining new orders, falling ship prices, weak vessel financing and intensifying competition amongst Chinese yards, said Deutsche Bank in a report.

The brokerage cut its target price for Yangzijiang to S$1.10 from S$1.20, kept its ‘hold’ rating, and lowered its new order assumptions in 2012-2014 by 13-33 percent.

It also lowered COSCO’s target price to S$1.00 from S$1.10, maintained its ‘hold’ rating and cut its new order assumptions for 2012-2013 by 11-17 percent. As a result, it trimmed its net income estimates for the shipbuilder by 9.1-9.4 percent over the same period.

1111 (0311 GMT)

(Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com)

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09:56 STOCKS NEWS SINGAPORE-OCBC raises target on Tiger Airways

OCBC Investment Research raised its target price on Tiger Airways Holdings Ltd to S$0.83 from S$0.76 and maintained its buy rating, citing the Singapore budget carrier’s improved operations.

Tiger shares were up 0.7 percent at S$0.695 and have risen around 9 percent so far this year versus the 15 percent gain in the FT ST Small Cap Index.

Tiger’s passenger yields in its fiscal first quarter rose 9 percent from a year earlier, while the fall in average jet fuel prices provided some cost relief, OCBC noted.

OCBC said the first-quarter operating profit posted by Tiger’s Singapore operations bodes well for the rest of the 2013 fiscal year as it is no longer burdened with excess aircraft, allowing it to moderate its capacity expansion in 2013.

Tiger’s Australian unit is primed for recovery with the ramping up of its operations to 60 sectors a day, after being hit by flying restrictions, and the expected peak travel season later in the year, OCBC said.

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Reporting by Eveline Danubrata in Singapore; eveline.danubrata@thomsonreuters.com

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