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STOCKS NEWS SINGAPORE-OCBC raises Tat Hong target price to S$1.70

Source : REUTERS
Last Updated: Mon, Nov 12, 2012 04:20 hrs

OCBC Investment Research raised its target price on Tat Hong Holdings Ltd to S$1.70 from S$1.42 and maintained its 'buy' rating, citing the strong growth momentum of the cranes and heavy equipment supplier.

Tat Hong shares were down 1.1 percent at S$1.385 on Monday. The stock has jumped 57 percent so far this year versus the 21 percent gain in the FT ST Small Cap Index.

Tat Hong reported a 37 percent increase in second-quarter net profit at S$17.3 million ($14.1 million), mainly due to the strong performance by its crane rental and tower crane segments.

OCBC said given the tight utilisation rates of Tat Hong's cranes, the company was expected to buy more crane assets in the second half of 2013 fiscal year for various projects in the region.

This should deepen its market presence and provide the next leg of growth for 2013-2014 fiscal years, OCBC said.

1203 (0403 GMT)

(Reporting by Eveline Danubrata in Singapore; Editing by Subhranshu Sahu; eveline.danubrata@thomsonreuters.com)

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10:16 STOCKS NEWS SINGAPORE-Mewah at 2-mth low after Q3 net profit fall

Shares of Mewah International Inc dropped to the lowest in two months after the palm oil firm reported a 82 percent fall in third-quarter net profit to $1.2 million from a year earlier.

Mewah shares fell as much as 4.6 percent to S$0.415, the lowest since Sept. 11. The stock has fallen nearly 11 percent so far this year, lagging the 25 percent gain in the FT ST Mid Cap Index.

"The primary reason for the erosion in profits was Mewah's emphasis on trying to maintain its margins, even at the cost of volumes, and this resulted in net income being barely positive due to fixed costs," Nomura said in a report.

Nomura, which has a 'neutral' rating and S$0.45 target price on the stock, said the outlook for Mewah's fourth quarter appears weak due to the volatile crude palm oil prices. It added that a downward revision in its and consensus estimates is "inevitable".




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