Cosco may gain if parent Cosco Group transfers its stake in 2 shipbuilding operations to the Spore-listed entity. According to DBSV, the injection of 19% of Cosco Shipyard Group & 100% of Cosco Shipbuilding Industry, which owns 2 yards in Nantong & Dalian could add 20% to Cosco's bottomline. Talk of Cosco Group restructuring surfaced after a govt panel's proposal to push forward listing of major SOEs in 2011 as part of 12th 5-Year Plan.
House keeps stock rating at Buy with a raised target price of $3.03, up from $2.76. Adds Cosco is poised for further re-rating if the parent injects strategic stakes, contract flow strengthens or shipbuilding improves.
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