Wednesday, March 22, 2017

SG Market (22 Mar 17)

The market could extend its pullback after Wall Street suffered its steepest drop this year on waning risk appetite and worries over President Trump's policy execution amid expensive valuations.

Regional markets in Tokyo (-1.6%), Seoul (-0.5%), and Sydney (-1.3%) opened lower.Technically, momentum indicators are exhibiting signs of weakness, and the STI could ease toward the lower bound of its uptrend channel at 3,140.

Stocks to watch:
*Keppel Corp: BlackRock sold 10.9m Keppel shares on 17 Mar at average price of $6.87, paring its deemed interest to 4.63% from 5.23%, thereby ceasing to be a substantial shareholder.

*Triyards: Disclosed that parent Ezra and sister company Emas Chiyoda Subsea, which have both filed for bankruptcy, owes it a combined US$3m in intercompany receivables and payables. Together with Ezra, the group has also guaranteed up to US$38.5m of joint bank facilities, which are liable in the event of a default.

*Libra: Secured contracts of $22.4m, which include the air-conditioning, electrical installation, as well as addition and alteration works.

*Neo Group: Subscribing for 416,327 new shares or 51% of enlarged share capital of Hi-Q Plastic Industries, a privately owned plastic and plastic product manufacturer, for RM1.6m, valuing Hi-Q at 13.2x FY15 trailing P/E.

*Rickmers Maritime: Senior lender HSH Nordbank has given the trust until 15 Apr to present a plan to restructure its debt. Rickmers is trying to restructure its $100m unsecured MTN maturing May ’17 and US$270.8m of secured bank debt. HSH may consider a material forgiveness of the debt if certain preconditions are in place.

*Auric Pacific: Valid acceptances for the privatisation offer at $1.65/share by Stephen Riady and CEO Andy Adhiwana has reached 94.04%. The company will be delisted after the close of the offer on 7 Apr.

*QT Vascular: Secured $10m of capital commitment from GEM Global Yield Fund, which can be drawn down over a 30-month term in exchange for shares. QT can opt for an additional $10m under the same terms within the next six month.

*KS Energy: Extending the maturity date of its $45m 6% convertible bonds due 2016 from 21 Mar ’17 to 21 Jun ’17.

*First Ship Lease Trust: Auditor Moore Stephens has flagged going concern issues in light of the trust’s FY16 net loss of US$31m as well as its current liabilities exceeding its current asset by US$179.4m.

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