Shares of Singapore's Olam International Ltd rose
3 percent, after hitting a three-and-a-half year low on
Wednesday, as analysts said the commodity trader's detailed
defence against allegations from short-seller Muddy Waters was
By 0134 GMT, Olam shares were 2.7 percent up at S$1.54, but
have lost 27.7 percent since the start of the year, compared
with the Straits Times Index's 14.4 percent rise.
"In our view, the explanations were satisfactory and should
clear any misunderstanding caused by Muddy Waters' accusations,"
said CIMB Research, which upgraded Olam to 'neutral' from
'trading sell' and kept its S$1.59 target price.
CIMB believes the worst of the clash with Muddy Waters is
over and Olam's share price should find support at book value of
S$1.35. However, it warned that sentiment could remain subdued
as investors continue to remain cautious.
Citigroup was positive on Olam's indication that it may
consider reducing its expansion pace as investors signalled that
greater execution focus and reduced leverage were important,
given a tough macro environment.
OCBC Investment Research also believed investors are likely
to adopt a cautious approach to valuing Olam. It now values the
company at 10 times 2013 earnings per share versus 12.5 times
previously, lowering its target price to S$1.44 from S$1.80.