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STOCKS NEWS SINGAPORE-Shares at 2-week high, but Nomura sees subdued 2013

Source : REUTERS
Last Updated: Mon, Nov 26, 2012 05:00 hrs

Singapore shares extended their gains for a sixth session to hit a two-week high, in line with other Asian bourses on hopes Greece will be able to avoid a near-term bankruptcy.

By 0242 GMT, the Straits Times Index was up 0.5 percent at 3,005.02, while the MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.2 percent.

Commodity trader Noble Group Ltd was the largest gainer on the STI, rising 3.7 percent to S$1.115 while palm oil firm Golden Agri-Resources Ltd rose 2.5 percent to S$0.625.

However, Nomura said it saw a subdued outlook for Singapore in 2013 as the country's ongoing economic restructuring is expected to drag on corporate earnings.

Consensus estimates of an 11 percent earnings per share growth in 2013 for Singapore appears too optimistic, with the greatest earnings risks coming from banks, developers and casino gaming sectors, Nomura said.

The brokerage was bullish on conglomerates such as Keppel Corp Ltd, Sembcorp Industries Ltd and Jardine Matheson Holdings Ltd, for their ability to generate steady earnings growth that can support dividends.

But Nomura was bearish on casino operator Genting Singapore Plc given Singapore's strict regulation over the industry. Developers are also expected to underperform as fundamentals deteriorate, with rising vacancies and large oncoming supply of homes.

1245 (0445 GMT) (Reporting by Charmian Kok in Singapore; Editing by Anand Basu; charmian.kok@thomsonreuters.com)

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11:12 STOCKS NEWS SINGAPORE-Citi cuts Sembcorp Marine target price

Citigroup cut its target price on rigbuilder Sembcorp Marine Ltd to S$5.40 from S$6.10 and kept its 'buy' rating, citing smaller revenue recognition and lower margin assumptions.

By 0259 GMT, Sembcorp Marine shares were flat at S$4.39 and have risen 15 percent since the start of the year, compared with the Straits Times Index's 13.4 percent gain.

Citi cut its 2012-2013 earnings per share estimates for Sembcorp Marine by 4-11 percent, but raised its 2014 estimates by 6 percent to account for higher repair contributions and drillship sales.

The brokerage expects Sembcorp Marine's earnings to bottom this year and see a strong rebound in 2013-2014, adding that it was "upbeat on the exploration and production cycle and believe it will continue into 2013, underpinned by demand for broad mix of products."

1101 (0301 GMT)

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

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10:01 STOCKS NEWS SINGAPORE-Maybank raises Sheng Siong target price

Maybank Kim Eng raised its target price for supermarket operator Sheng Siong Group Ltd to S$0.60 from S$0.52 and kept its 'buy' rating, citing its high growth potential and improving efficiency.

By 0152 GMT, Sheng Siong shares were unchanged at S$0.49, and have gained 11.4 percent since the start of the year, compared with the FTSE ST Small Cap Index's 21.4 percent rise.

Sheng Siong is able to maximise its store space while designing each store to suit different customer demographics in the area, Maybank noted.

The supermarket operator also offers the lowest prices in Singapore, while investing in technology such as electronic price tagging to improve its efficiency and allow high inventory turnover.

Maybank is pegging Sheng Siong's valuations to competitor Dairy Farm International's 12-month forward price to earnings ratio of 27 times, with a 20 percent discount.

0953 (0153 GMT)



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