Brokers' take

Published Tue, Aug 8, 2017 · 09:50 PM
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Cosco Shipping International | Hold Target price: S$0.27 August 8 close: S$0.30 DBS Group Research, August 8

Cosco Shipping International (Cosco)'s net losses seemed to have narrowed in H1 17. Parent's proposed buyout eliminates insolvency risk, which would otherwise be a key overhang at an alarmingly high net gearing of 23x. Existing investors could hold on for more clarity on Cosco's future direction and potential parental asset injection. Parent offered 1,466 million yuan cash (about S$300 million) to take over Cosco Shipyard Group in May 2017. An earlier-than-expected recovery in oil prices could catalyse an industry recovery with Cosco securing more orders at attractive prices. Sharp improvements in productivity could also cause its share price to re-rate.

Delfi Ltd | Hold Target price: S$2.21 August 8 close: S$2.12 OCBC Investment Research, August 8

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