Dec 24: NOL, Olam, Silverlake Axis

Singapore stocks may open higher on Friday after Wall Street racked up a fourth straight week of gains overnight, but trading is expected to be sluggish as many traders are away on Christmas Eve.

The following companies may have unusual price changes in Singapore trading today. Stock symbols are in parentheses, and share prices are from the previous close. Singapore’s Straits Times Index dropped 0.2% to 3,137.78.

Commodity suppliers: The Thomson Reuters/Jefferies CRB Index, which tracks prices of 19 commodities from copper to corn, gained 0.4% in New York yesterday, extending its five-day advance to 3.8%. Noble Group (NOBL SP), a Hong Kong-based commodities supplier, slipped 1.4% to $2.08. Olam International (OLAM SP), a Singapore-based supplier of agricultural commodities, lost 0.3% to $3.08.

Neptune Orient Lines (NOL SP): Southeast Asia’s biggest container carrier said it received financing offers for its US$1.2 billion ($1.6 billion) acquisition of 12 ships. The stock fell 0.9% to $2.14.

RH Energy (RHE SP): The provider of engineering services to the oil and gas industry said it won contracts valued at US$8.7 million ($11.4 million). RH Energy was unchanged at 18.5 cents.

Roxy-Pacific Holdings (ROXY SP): The developer said it’s buying a commercial building in eastern Singapore for $35.5 million. The shares were unchanged at 42.5 cents.

Silverlake Axis (SILV SP): The provider of customized software solutions for banks said its controlling shareholder Intelligentsia Holding sold 50 million shares at 32 cents each in a share placement. Silverlake climbed 4.6% to 34.5 cents.

LMA International (LMAI.SI), a Singapore-listed medical equipment firm, said on Friday it had signed an agreement with DBS Bank for a three-year standby revolving credit facility for up to US$12.5 million ($16.3 million).

Wanxiang International (WXIL.SI), which manufactures and trades flavours and fragrances, said on Thursday it had successfully tendered to acquire a plot of land in Jiangsu Province, China, for 74.6 million yuan ($14.6 million) for its venture into property development.

Noble wants to be sole owner of its Brazil cane ops

Noble’s (NOBG.SI) purchase of two cane mills in Brazil this week, the latest addition to its fast-rising cane processing capacity, reflects its go-it-alone approach that sets it apart from competitors that are partnering with local companies, the group’s CEO said on Thursday.

Asia’s biggest commodities trader has agreed to pay $950 million ($1.24 billion) for two sugar and ethanol facilities owned by Brazilian group Cerradinho.

“Cane operations are extremely important. Brazil has the world’s lowest costs, and demand for energy, sugar is rising in emerging markets as well as for ethanol in the Brazilian market,” Noble’s Chief Executive Ricardo Leiman told Reuters.

Brazil is the world’s top sugar producer and exporter. Cane is also the feedstock for its huge ethanol biofuel production, that it has pioneered as a mainstream fuel that most new cars on its roads can burn.

Several companies that entered the cane sector over the last few years such as Royal Dutch Shell (RDSa.L) and state-run oil company Petrobras (PETR4.SA) have opted to team up with local partners rather than go it alone.

Before closing the deal with Noble, Cerradinho spent four months negotiating with BP (BP.L), which aimed for a 50% share in the Brazilian group.

Experts say that some of Brazil’s cane sector’s unique characteristics, which require both agricultural and industrial know-how, is behind companies’ decision to look for local associations.

But Hong Kong-based Noble, defined by Leiman as “a global supply chain manager,” has adopted a bolder approach.

“We already have around four years of experience (in cane). We’re over the learning curve. We prefer to learn (on our own) and be the big operators even if it takes longer,” Leiman said.

Noble has operations in sectors ranging from coffee and cotton origination to ship management and from coal and iron ore mining to soy processing in several countries. In many cases, its operations are in tandem with partners.

BRAZILIAN CANE
With the addition of two more crushing units near its existing assets, all in Sao Paulo state, the firm expects its larger operations will begin to generate economies of scale.

“We created a cane cluster that should benefit from synergies in logistics and costs,” Leiman said. All of them produce sugar, ethanol and electric energy from the burning of cane bagasse that is sold to the Brazilian grid.

Noble entered the sector in 2007 when it bought the Noroeste Paulista mill, in Sao Paulo state. It invested to expand its crushing capacity to 5 million tonnes from 1.3 million tonnes per year.

The group also built Meridiano mill, 60 km (37 miles) away from the existing one. This unit, whose construction has just finished, has a capacity of 4.5 million tonnes per season.

The two plants bought from Cerradinho have a combined capacity to process 8 million tonnes of cane per year, and are located about 100 km from the two others.

With the acquisition, the group has become one of the country’s top 10 cane groups, with a crushing capacity of 17.5 million tonnes per season.

Sugar production capacity will jump to 1.34 million tonnes from 740,000 tonnes in its two mills. Ethanol capacity will double to 600 million litre, and energy generation will grow to 750 megawatts per hour, from 450 MWh previously.

In Brazil, the group also operates a fuel terminal and warehouses. It also originates coffee and cotton, and is building a soy processing plant and a biodiesel factory. In October, it inaugurated new terminal in the port of Santos.

Vietnam's HAGL group plans US$200m Singapore bonds

Vietnam’s Hoang Anh Gia Lai group, or HAGL (HAG.HM), plans to raise US$200 million ($261 million) by issuing bonds to be listed on the Singapore Exchange, an executive said on Thursday.

Shareholders of the group based in Vietnam’s Central Highlands region have approved its plan to issue five-year bonds in 2011, HAGL’s chairman Doan Nguyen Duc told Reuters.

“Procedures will start in early January, after we have the ratings,” he said.

The bond proceeds will fund five hydro-power plants and rubber tree planting projects in Laos, Cambodia and Vietnam, the group said in a document sent to shareholders and seen by Reuters.

The group, with registered capital of 2.93 trillion dong ($196.3 million), operates in property, mining, rubber plantation and hydro-power.

It has sold 16.22 million shares to Deutsche Bank Trust Co Americas and the shares will be listed on the London Exchange at the end of this month or in early January, Doan Nguyen Duc said.

STI down 0.2% to close at 3,137.78

Singapore’s Straits Times Index fell 0.2% to 3,137.78 at the close. Three stocks dropped for each that climbed in the benchmark equity index of 30 companies.

Shares on the measure trade at an average 15.3 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to data compiled by Bloomberg.

The following shares were among the most active in the market. Stock symbols are in parentheses after the company name.

China-linked developers: China increased land supply this year and stepped up the scrutiny of real estate investments by foreign companies as it rolls out more measures to contain 18 months of gains in property prices. China’s land supply rose 48% to 128,200 hectares in the first 11 months, while sites for residential developments surged 51%, the Land and Resources Ministry said in a statement.

CapitaLand (CAPL SP), which counts on China for about a fifth of its sales, declined 0.3% to $3.64. City Developments (CIT SP), which this week announced its first land purchase in Chongqing, China, lost 1.3% to $12.54.

Palm-oil producers: Crude palm-oil futures for March delivery climbed for a fourth day in Kuala Lumpur today. Global Palm Resources Holdings (GPR SP) jumped 1.5% to 34.5 cents. First Resources (FR SP), an Indonesian palm plantation company, advanced 0.7% to $1.48.

Financial One Corp. (FIN SP), the provider of financial services, surged 20% to 50.5 cents. The company said Executive Chairman Andre John-Lee Koo is offering to buy out minority shareholders at 48.5 cents a share as part of a proposed voluntary delisting.

United Industrial Corp. (UIC SP), the owner of office buildings and shopping malls in Singapore, advanced 0.8% to $2.43. Developer UOL Group (UOL SP) said it agreed to buy a 9.7% stake in United Industrial Corp. for $320.5 million from United Overseas Bank (UOB SP), raising its stake to 42% from 32.3%. UOL Group fell 1.7% to $4.54, and UOB lost 0.3% to $17.82.

R H Energy awarded $11.4m in contracts to design plant upgrades

Mainboard-listed R H Energy says it has won contracts worth US$8.7 million ($11.4 million), to provide process engineering design, technical services and commissioning for the upgrading of a caprolactum plant with an annual production capacity of 200,000 tonnes and a special epoxy plant with an annual production capacity of 50,000 tonnes for the Sinopec group companies.

Keppel AmFELS delivers third Rowan rig ahead of schedule

Keppel AmFELS Inc., the wholly-owned US subsidiary of Keppel Offshore & Marine (Keppel O&M), says it has delivered the third of four EXL jackup rigs to a subsidiary of Rowan Companies, Inc. (Rowan) ahead of schedule and within budget.

Christened Rowan EXL-III, the rig is scheduled to depart Keppel AmFELS’ yard in Brownsville, Texas in January 2011 to commence operations on an ultra deep gas well for McMoRan Exploration Company in the Gulf of Mexico.

The ABS-classed EXL jackup design is an enhancement of the LeTourneau Super 116E model. With leg lengths of 477 ft and a capable hook load of 2,000,000 lbs, Rowan EXL-III employs state-of-the-art technology to drill high-pressure, high-temperature and extended-reach wells worldwide. It is capable of operating in water depths of 350 ft or more, and drilling to a depth of 40,000 ft.

Meanwhile, Keppel AmFELS says the construction of Rowan’s fourth jackup rig is on track for delivery in 1Q 2012.

STI gains 0.5% to 3,160.67 as of 9:44 a.m.

Singapore’s Straits Times Index gained 0.5% to 3,160.67 as of 9:44 a.m. Five stocks advanced for each that fell in the benchmark equity index of 30 companies.

Shares on the measure trade at an average 15.4 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to data compiled by Bloomberg.

The following shares were among the most active in the market. Stock symbols are in parentheses after the company name.

Financial One Corp. (FIN SP), the provider of financial services, surged 14% to 48 cents. The company said Executive Chairman Andre John-Lee Koo is offering to buy out minority shareholders at 48.5 cents a share as part of a proposed voluntary delisting.

Hyflux (HYF SP), Singapore’s biggest water recycling company, increased 0.9% to $2.32. The company said it appointed Cho Wee Peng as chief financial officer, replacing Sam Ong, who will remain as deputy chief executive officer and focus on developing the group’s business in the Middle East and Africa.

Sembcorp Marine (SMM SP), the world’s second-biggest builder of oil rigs, gained 0.2% to $5.13. BNP Paribas raised its share-price forecast on the stock to $6.78 from $5.58 and maintained its “buy” rating.

United Industrial Corp. (UIC SP), the owner of office buildings and shopping malls in Singapore, advanced 2.1% to $2.46. Developer UOL Group (UOL SP) said it agreed to buy a 9.7% stake in United Industrial Corp. for $320.5 million from United Overseas Bank (UOB SP), raising its stake to 42% from 32.3%.


 

Singapore's inflation accelerated to 22-month high in November

Singapore’s inflation rate rose to the highest level since January 2009, an acceleration that may put pressure on the central bank to allow further currency appreciation to curb price increases.

The consumer price index climbed 3.8% in November from a year earlier, after gaining 3.5% in October, Singapore’s Department of Statistics said in a statement today. That matched the median estimate of 14 economists surveyed by Bloomberg News. Prices rose 0.3% from October, without adjusting for seasonal factors.

Singapore’s economic expansion this year has fueled prices, prompting the central bank to allow faster currency gains and leading the government to implement measures to cool the property market. The Monetary Authority of Singapore uses the exchange rate instead of interest rates to manage inflation, which it forecasts may quicken to about 4% by the end of 2010 and “stay high” in the first half of 2011.

“Rising food, transport and housing costs, compounded by escalating wage pressures, will likely keep inflation above 4% in early 2011,” Chua Hak Bin, a Singapore-based economist at Bank of America Merrill Lynch, said before the report. “MAS will have to stay tight, in our view, with the risk for further tightening in April next year.”

The central bank said in October it will steepen and widen the currency’s trading band while continuing to seek a “modest and gradual appreciation,” after undertaking a one-time revaluation in April this year. The Singapore dollar has gained more than 7% against the US currency this year.

Consumer prices will probably rise 2.8% this year, and 2.9% in 2011, according to the median estimate in a survey of 22 economists by the central bank released this month. Inflation will average between 2% and 3% next year, the central bank predicts.

Fund manager appeals Singapore's first civil stock-rigging case

Pheim Asset Management Sdn. and its Chief Executive Officer Tan Chong Koay, appealed a Singapore High Court ruling that they’d manipulated the shares of a listed company in the country’s first civil stock-rigging lawsuit.

“If left to stand, the decision would either serve to curtail genuine market activity by the timorous or to set a penal trap for the unwary,” they said in their appeal filed Dec 21 at the Singapore High Court.

Tan and Pheim bought almost 90% of the traded shares of United Envirotech from Dec 29 to Dec 31, 2004. The shares rose 17% over the three trading days and helped raise the net asset value of the fund management firm’s accounts, triggering bonuses of $50,790 ($38,866) and a management fee of $115. Justice Lai Siu Chiu said the gain sought by Pheim and Tan wasn’t monetary, in ruling they manipulated the stock.

Tan and his Malaysian fund management company were fined $250,000 each. The Monetary Authority of Singapore sought a fine of $1 million for each.

Pheim “is a value investor,” the company and Tan said in their appeal. “Pheim is also a contrarian investor -- buying when others are selling and selling when others are buying.”

The Monetary Authority has no evidence to prove Pheim and Tan had any other intention but to buy undervalued shares, they said in the 212 pages of court documents filed to back the appeal.

“There was in fact no other intention,” they said.

‘Good Investment’
Pheim expected shares of companies in the water treatment sector to rise since 2001, according to the filing. United Envirotech shares were overlooked and deemed to be a good investment, Pheim said in its appeal.

Singapore, which expanded its fund management industry to a record $1.2 trillion at the end of 2009, has vowed to clamp down on market abuse. The central bank, which won the city’s first civil lawsuits for stock rigging and insider trading this year tightened the rules for financial institutions in reporting employee misconduct.

“Such offenses undermine the effectiveness and efficiency of the securities market and are often insidious and difficult to detect,” Lai said.

Tan, who founded Pheim Group, was in 2002 named one of five successful Singapore-based boutique fund managers by the Government of Singapore Investment Corp.

Tan has offices in Singapore and Malaysia. He had said, jokingly, in August 2006 that Pheim, which manages about US$1 billion ($1.3 billion), was a made-up word which means Please Help Everyone Invest Money.

Tan and Pheim “would not have risked their livelihood and business by seeking to manipulate” the stock knowing that any unusual trading activities would be tracked by the financial regulator, according to their appeal.


 

STI gains 0.4% to 3,157.79 at the break

Singapore’s Straits Times Index gained 0.4% to 3,157.79 as of the 12:30 p.m. trading break. Four stocks advanced for each that fell in the benchmark equity index of 30 companies.

Shares on the measure trade at an average 15.4 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to data compiled by Bloomberg.

The following shares were among the most active in the market. Stock symbols are in parentheses after the company name.

Palm-oil producers: Crude palm-oil futures for March delivery climbed for a fourth day in Kuala Lumpur today.

Global Palm Resources Holdings (GPR SP) jumped 2.9% to 35 cents. Golden Agri-Resources (GGR SP), the world’s second-biggest palm-oil producer, increased 0.7% to 76.5 cents. First Resources (FR SP), an Indonesian palm plantation company, advanced 1.4% to $1.49.

Financial One Corp. (FIN SP), the provider of financial services, surged 29% to 54 cents. The company said Executive Chairman Andre John-Lee Koo is offering to buy out minority shareholders at 48.5 cents a share as part of a proposed voluntary delisting.

Hyflux (HYF SP), Singapore’s biggest water recycling company, increased 0.9% to $2.32. The company said it appointed Cho Wee Peng as chief financial officer, replacing Sam Ong, who will remain as deputy chief executive officer and focus on developing the group’s business in the Middle East and Africa.

United Industrial Corp. (UIC SP), the owner of office buildings and shopping malls in Singapore, advanced 1.7% to $2.45. Developer UOL Group (UOL SP) said it agreed to buy a 9.7% stake in United Industrial Corp. for $320.5 million from United Overseas Bank (UOB SP), raising its stake to 42% from 32.3%. UOL Group fell 0.4% to $4.60, and UOB climbed 0.3% to $17.94.

Singapore stocks up at midday; Finance One, small-caps in focus

Singapore shares rose on Thursday with smaller and medium-sized firms in the spotlight, but traders said volumes were sluggish and will likely continue to be thin in the afternoon session with many participants away for the Christmas holiday.

By the midday break, the Straits Times Index (STI) <.FTSTI> was up 0.42%, or 13.31 points, at 3,157.62. The total value of shares traded in the morning session was $379.6 million, much lower than $605.4 million on Wednesday.

“Today’s volume is very weak, which is typical during the Christmas season. Trading is going to be very lethargic,” said Terence Wong, co-head of research at DMG & Partners.

Local traders said the STI could see a small rise after the midday break, though gains are likely to be capped at around 3,165 points.

Shares of Taiwan-based financial services firm Financial One (FNON.SI) rose as much as 30% after its executive chairman offered to buy all the shares he did not already own at $0.485 per share.

At midday, Financial One shares were up 28.6% at $0.54 on a volume of 19.4 million shares.

Shares of offshore drilling firm Jasper Investments (JASP.SI) rose as much as 20% after it said a key stakeholder will convert  existing loans to new equity to help it buy a US$180 million ($235 million) rig from Keppel Corp.

At midday, Jasper shares were up 13.3% at $0.085 on a volume of 11.8 million shares. Keppel gained 0.9% at $10.82 with 721,000 shares changing hands.


 

Dec 23: GLP, UOL, Financial One, Sembcorp Marine, Wilmar

Singapore shares may open higher on Thursday after the S&P 500 rose overnight to its highest level since the collapse of Lehman Brothers, led by bank stocks that have leapfrogged other sectors in December.

The following companies may have unusual price changes in Singapore trading today, say Bloomberg and Thomson Reuters. Stock symbols are in parentheses, and share prices are from the previous close. Singapore’s Straits Times Index gained 0.1% to 3,144.31.

Global Logistics Properties (GLP SP): The logistics company whose customers include Wal-Mart China, Deutsche Post AG’s DHL and FedEx Corp., said it agreed, through a unit, to buy 19.9% of Shenzhen Chiwan Petroleum Supply Base Co. for HK$539 million ($90.2 million). The stock gained 0.5% to $2.18.

UOL Group (UOL SP): The Singapore developer said it agreed to buy a 9.7% stake in United Industrial Corp. (UIC SP) for $320.5 million from United Overseas Bank (UOB SP), raising its stake to 42% from 32.3%. UOL climbed 0.7% to $4.62.

Financial One Corp. (FIN SP): The provider of financial services said Executive Chairman Andre John-Lee Koo is offering to buy out minority shareholders at 48.5 cents a share as part of a proposed delisting. That compares from its last traded price of 42 cents. The stock has been suspended from trading since Nov. 15 and will start trading today.

Hyflux (HYF SP): Singapore’s biggest water recycling company said it has appointed Cho Wee Peng as chief financial officer, replacing Sam Ong, who will remain as deputy chief executive officer and focus on developing the group’s business in the Middle East and Africa. The stock lost 0.4% to $2.30.

KS Energy Services (KST SP): The maker of drilling equipment for oil explorers said it will raise $16.2 million, selling 15 million shares at $1.08 to TAEL One Partners The shares were unchanged at $1.09.

Sembcorp Marine (SMM SP): The world’s second-biggest builder of oil rigs had its share-price forecast raised to $6.78 from $5.58 at BNP Paribas, which maintained its “buy” rating. The stock advanced 2.6% to $5.12.

Silverlake Axis (SILV SP): The provider of customized software solutions for banks said its controlling shareholder Intelligentsia Holding is proposing to sell up to 50 million shares in a share placement. The shares were unchanged at 33 cents.

Wilmar International (WIL SP): The world’s biggest palm-oil trader had its share-price forecast lowered to $6.73 from $7.49 at Daiwa Securities Group Inc., which maintained its rating at “outperform.” The stock tumbled 5.1% to $5.62.

Zipper maker Fuxing China (FXCG.SI) said on Wednesday it would buy three Chinese companies in the electro-plating and colour dyeing business for a total of 372 million yuan ($73.2 million), confirming a Reuters report in October.

Hu An Cable (HACH.SI), a Singapore-listed Chinese cable manufacturer, said on Wednesday it had acquired land in Jiangsu Province, China, for 21.2 million yuan ($3.2 million) for the construction of a new copper rods plant.

Global Logistic Properties buys 19.9% stake in Chinese logistics facility provider for $91m

Global Logistic Properties, the owner of modern logistics facilities in China and Japan, says wholly-owned subsidiary China Logistics Holding (12), has agreed to acquire a 19.9% stake in Shenzhen Chiwan Petroleum Supply Base Co. (SCPSB), the parent company of Blogis, which is the second largest modern logistics facility provider in China to GLP.

GLP will acquire 45.89 million SCPSB shares from Offshore Joint Services (Bases) Company of Singapore (OJSB), a joint venture between JTC Corporation and Toll Holdings. The shares of SCPSB will be acquired at a price of HK$11.75 ($1.974) per share, 1.4% below the HK$11.92, the closing price of SCPSB shares on Dec 21, or a total of HK$539 million. The acquisition will be funded entirely from proceeds of GLP’s Initial Public Offering.

Blogis owns 12 projects at prime locations in 8 key strategic logistics hubs in China, with 71% of its GFA located in tier one cities. The Blogis portfolio comprises 6 completed projects with a total GFA2 of 0.62 million sqm, 2 projects with total GFA of 0.16 million sqm currently under construction, and 4 parcels of land bank with planned GFA of 0.37 million sqm.

SCPSB’s Offshore Petroleum Logistics services operates the Chiwan Base, which has 0.1 million sqm of warehouse space and 0.2 million sqm of yard space, and is the only base in Eastern South China Sea that provides petroleum warehousing and logistics services to multinational oil companies and oil service companies. SCPSB reported net profit of RMB 112 million ($22 million) in fiscal year 2009 with a net profit margin of 34%.

UOL agrees to buy UIC shares from UOB

UOL Group has agreed to buy a 9.7% stake in United Industrial Corp. for $320.5 million from United Overseas Bank, UOL said in a statement to the Singapore Stock Exchange today.


 

Trader Hin Leong plans mega refinery in Singapore: Update

Top Asian trader Hin Leong Trading has submitted a proposal to the Singapore government to build a large state-of-the-art refinery, two industry sources with direct knowledge of the plan said on Wednesday.

The plant, expected to cost US$6-8 billion ($7.9-10.5 billion), is slated to process at least 500,000 barrel-per-day of oil and take a maximum of three and a half years to build, possibly in partnership with a Chinese state oil firm, the sources said.

“All the infrastructure is ready...The key is if the government decides that Singapore needs another big refinery,” one of the sources told Reuters. “The project is good to go, all it needs is an agreement of the Singapore government to proceed.”

The Singapore government said that they do not have a specific aim of attracting greenfield refinery investments, but would evaluate all projects based on the value they bring.

“We will enhance the long term competitiveness of our existing refining base in Singapore by focusing on three pillars - refinery upgrading to increase the complexity of existing refineries, integration with chemicals and integration with lubricants,” a spokesman for Singapore’s Economic Development Board, which spearheads the country’s investment initiatives, said in response to queries.

Earlier this year, the Singapore government unveiled a 10-year masterplan to make Jurong Island Asia’s leading chemicals hub.

The refinery is expected to be a top-class facility, in the mould of Reliance’s plants in India, producing green fuels such as ultra-low sulphur gasoline, diesel and naphtha.

The plant is to be located next to Hin Leong’s US$570 million Universal Terminal, Asia’s largest commercial oil storage facility with 2.3 million cubic metres capacity, which can park two very large crude carriers at the same time.

“There could be a business case if the refinery is geared towards petrochemicals, such as in the production of naphtha,” said Tilak Doshi, principal economist with Singapore’s Energy Studies Institute.

The UT facility will provide the refinery more operational efficiency, giving immediately available storage both for crude oil and refined products.

The planned greenfield project will increase Singapore’s refining capacity by a third from the current total of about 1.4 million bpd.

Singapore already has three refineries -- ExxonMobil’s(XOM.N) 605,000 bpd, Royal Dutch Shell’s (RDSa.L) 500,000 bpd and Singapore Refining Co’s 290,000 bpd, which is jointly-owned by PetroChina and Chevron Corp.

One of China’s four national oil firms -- PetroChina(0857.HK), Sinopec Corp (0386.HK), CNOOC or Sinochem Corp -- could be Hin Leong’s partner for the massive investment and the trader may also rope in a European partner, the Business Times reported.

PetroChina, Asia’s largest oil and gas firm, already owns 35% stake in Hin Leong’s 14 million-barrel Universal Terminal storage facility.

The Chinese energy giant also owns nearly half of the 295,000-bpd Singapore Refining Co. Still, the source said PetroChina has enough room to expand further in the Asian oil hub given its financial strength.

“PetroChina has only 140,000 bpd capacity here. Look at what Shell has, 500,000 bpd; and Exxon, 600,000 bpd.”


 

Hu An Cable acquires land to build $17.5m copper rod plant

Mainboard-listed Hu An Cable Holdings, the China-based wire and cable manufacturer, says it recently acquired 61,335 square metres of land in Jiangsu Province for RMB21.2 million ($4.18 million) to build its RMB88.9 million copper rod plant.

The land is located adjacent to the group’s existing production facilities, with a tenure of 50 years. Once completed, the plant will triple its annual production capacity of copper rods from 21,000 tonnes to 75,000 tonnes by September 2011.

In addition, Hu An Cable will be constructing a new RMB67.7 million vertical melt furnace production line with a daily production capacity of 300 tonnes at the new plant. The vertical melt furnace production line will be able to produce three major products, namely, copper rods, standard copper wires and stranded copper wires.

The vertical melt furnace production line will significantly improve its production efficiency through the reduction of energy consumption and the extension in the life span of the equipments.

The three major products from the new plant will both be used internally and sold to other wire and cable manufacturers.

The acquisition of land, construction of new plant and acquisition and installation of the vertical melt furnace production line will be fully financed through the proceeds raised from the issuance of Taiwan depository receipts by the group in October.

Keppel Corp to build $236m rig for Jasper

Keppel Corp (KPLM.SI), the world’s biggest rig maker, has won an order to build a jackup rig worth US$180 million ($236 million) from Singapore-listed offshore drilling firm Jasper Investments (JASP.SI) with an option for another similar unit.

If exercised, the option of the additional rig will bring the total value of the contract to about US$365 million.

Separately, Jasper Investments said Morton Bay, which has a 79% controlling stake in it, will capitalise all its existing loans to the company to support Jasper’s plan to expand its fleet.

The US$194.6 million in loans will be offset against 1,946,320,562 new ordinary shares in Jasper, it said in a statement.

The new shares will be issued at $0.13 each. Jasper shares closed 25% higher at $0.075.


 

Trader Hin Leong plans mega refinery in Singapore

Top Asian trader Hin Leong Trading has submitted a proposal to the Singapore government to build a large state-of-the-art refinery, two industry sources with direct knowledge of the plan said on Wednesday.

The plant, expected to cost US$6–8 billion ($7.9–10.5), is slated to process at least 500,000 barrel-per-day of oil and take a maximum of three and a half years to build, possibly in partnership with a Chinese state oil firm, the sources said.

“All the infrastructure is ready...The key is if the government decides that Singapore needs another big refinery,” one of the sources told Reuters. “The project is good to go, all it needs is an agreement of the Singapore government to proceed.”

Earlier this year, the Singapore government unveiled a 10-year masterplan to make Jurong Island Asia’s leading chemicals hub.

The refinery is expected to be a top-class facility, in the mould of Reliance’s plants in India, producing green fuels such as ultra-low sulphur gasoline, diesel and naphtha.

The plant is to be located next to Hin Leong’s US$570 million Universal Terminal, Asia’s largest commercial oil storage facility with 2.3 million cubic metres capacity, which can park two very large crude carriers at the same time.

“There could be a business case if the refinery is geared towards petrochemicals, such as in the production of naphtha,” said Tilak Doshi, Principal Economist with Singapore’s Energy Studies Institute.

The UT facility will provide the refinery more operational efficiency, giving immediately available storage both for crude oil and refined products.

The planned greenfield project will increase Singapore’s refining capacity by a third from the current total of about 1.4 million bpd.

Singapore already has three refineries -- ExxonMobil’s (XOM.N) 605,000 bpd, Royal Dutch Shell’s (RDSa.L) 500,000 bpd and Singapore Refining Co’s 290,000 bpd, which is jointly-owned by PetroChina and Chevron Corp.

One of China’s four national oil firms -- PetroChina (0857.HK), Sinopec Corp (0386.HK), CNOOC or Sinochem Corp -- could be Hin Leong’s partner for the massive investment and the trader may also rope in a European partner, the Singapore Business Times reported.

PetroChina, Asia’s largest oil and gas firm, already owns 35% stake in Hin Leong’s 14 million-barrel Universal Terminal storage facility.

The Chinese energy giant also owns nearly half of the 295,000-bpd Singapore Refining Co. Still, the source said PetroChina has enough room to expand further in the Asian oil hub given its financial strength.

“PetroChina has only 140,000 bpd capacity here. Look at what Shell has, 500,000 bpd; and Exxon, 600,000 bpd.”

Singapore Oct visitor arrivals soar 16% from a year ago

Visitor arrivals to Singapore in October rose 15.8% from a year earlier to 978,000, the highest number of arrivals recorded for the month of October ever, the Singapore Tourism Board (STB) said on Wednesday.

But the number was still below July’s figure when a record 1.1 million people visited the city-state.

Indonesia contributed the largest number of visitors with 179,000 in October, while South Korea was the fastest-growing market for Singapore’s tourism industry, with visitor arrivals jumping 80.4% from a year ago.

STB’s figures do not include the thousands who cross over from Malaysia daily by land.

STB said average occupancy rate at Singapore hotels in October was 86%, while the average room rate rose in October by 16.2% from a year ago to $214.

STB said it was optimistic the country’s tourism receipts would reach its target range of $17.5 to $18.5 billion in 2010 compared to $12.4 billion in 2009.


 

Armstrong Industrial Corp. to set up two new manufacturing plants in China

Armstrong Industrial Corporation, one of the leading foam and rubber component manufacturers specialising in noise, vibration and heat management for the car and electronics industries, says it plans to set up two new manufacturing plants in China over the next three years.

Armstrong has also raised the capital from $4.9 million to $6.5 million in its 80% owned Armstrong-Odenwald (Asia), a joint venture with German partner Odenwald-Chemie Gmbh.

This year, the company increased its existing plant size in Changchun, Guangzhou and Wuhan raising its overall plant capacity in China by 45.2%, from 210,809 sq ft in 2009 to 306,039 sq ft.

This enabled the group to match the aggressive business expansion plans of major automotive customers, such FAW-Volkswagen and Guangzhou Honda, says Armstrong.

Temasek assets evaluated by Indonesia for seizure: Update

Indonesia’s anti-monopoly agency is evaluating Temasek Holdings Pte’s assets in the country and said the government has the right to seize them if a court-imposed fine isn’t paid.

The Singapore state-owned investment company lost its final appeal in the Supreme Court on May 24 for violating antitrust laws, the Indonesian court said on its website at the time. A fine of 150 billion rupiah ($22.3 million), which includes 15 billion rupiah for each of 10 Temasek-linked companies, including the holding company, involved in the case, was set, the anti-monopoly agency said.

“We’re now inventorying Temasek’s assets and expect to complete that in 2011, and they will be seized if the fine isn’t paid,” Tresna Soemardi, the agency’s chairman, said in a phone interview yesterday.

The Temasek case may cause uncertainty and cool foreign investors’ appetite for Indonesian assets in the short-term, said Chandra Pasaribu, an analyst at PT Danareska Securities in Jakarta.

“This case won’t affect investment in Indonesia medium to long term,” Pasaribu said by phone today “But the coverage of the case will bring negative impact as it will tend to affect the intention to invest in Indonesia due to the monopoly. The investment risk will increase.”

Antitrust Laws
The Indonesian competition regulator KPPU has said Temasek breached antitrust laws by using indirect stakes in PT Telekomunikasi Selular, known as Telkomsel, and PT Indosat, the country’s top two mobile-phone service providers, to fix prices.

“Temasek has not received official notification from the Supreme Court,” Goh Yong Siang, Temasek’s senior managing director of strategic relations, said in an e-mailed response to queries.

The Central Jakarta District Court received the formal notification from the Supreme Court, sent on Dec 3, and is processing the document that it will then send to KPPU, Temasek and the South Jakarta District Court, where the Temasek lawyers settled the case, said Hendro Santosa, a spokesman at the Central Jakarta District Court.

It took since May because the court had to collect the 770 pages of the judicial review panel, Santosa said.

“Once the company has been formally notified of the fine and doesn’t pay it, the Indonesian anti-monopoly commission may ask for a court order to seize the assets,” Muhammad Reza, the agency’s chief of investigations, said by phone yesterday.

Temasek’s Singapore Technologies Telemedia Pte unit sold its stake in Indosat, Indonesia’s second-largest mobile-phone services provider, to Qatar Telecom QSC in June 2008 after an earlier district court ruling. A unit of Singapore Telecommunications, Southeast Asia’s biggest phone operator and majority owned by Temasek, has a 35% stake in Telkomsel, the biggest mobile carrier.

Koran Tempo first reported the possible seizure of Temasek’s assets yesterday.

Financial One chairman makes exit cash offer of 48.5 cents

Financial One Corp. Executive Chairman Andre John-Lee Koo is seeking a voluntary delisting of the company and offering to buy out minority shareholders with an offer of 48.5 cents in cash per share. The offer is 15% more than the last closing price.

STI up 0.1% to close at 3,144.31

Singapore’s Straits Times Index gained 0.1% to 3,144.31 at the close. Three stocks advanced for every two that fell in benchmark equity index of 30 companies.

Shares on the measure trade at an average 15.3 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to data compiled by Bloomberg.

The following shares were among the most active in the market. Stock symbols are in parentheses after the company name.

CapitaMalls Asia (CMA SP), the owner of shopping malls in Singapore, Japan, China, India and Malaysia, gained 1.6% to $1.89 million. The company said it will buy the Queensbay Mall in Penang, Malaysia, for $275.6 million.

Hengxin Technology (HENG SP), a supplier of coaxial cables used in mobile communications, advanced 4.1% to 38.5 cents. The company said it will raise net proceeds of $16.1 million from the sale of its shares and proposed listing on the Stock Exchange of Hong Kong.

Noble Group (NOBL SP), a Hong Kong-based commodities supplier, gained 1.9% to $2.11. The Thomson Reuters/Jefferies CRB Index, which tracks prices of 19 commodities from copper to corn, gained 0.8% in New York yesterday, extending its three-day advance to 3%.

Sembcorp Marine (SMM SP), the world’s second-biggest oil rig builder, climbed 2.6% to $5.12. The company said it won an order two build two jack-up rigs valued at US$400 million ($524 million) from Noble Corp., the world’s third-largest deep-water oil and gas driller.

Wilmar International (WIL SP), the world’s biggest palm-oil trader, slumped 5.1% to $5.62, the lowest since June 2. The company said it will invest 889.2 million yuan ($175 million) in a joint venture with Kerry Properties (China) and Shangri-La China to develop a hotel in China’s Liaoning province.

“We believe that the market may take this announcement negatively,” Goldman Sachs Group Inc. analysts Patrick Tiah and Nikhil Bhandari wrote in a note to clients today. “This appears to be a sharp departure from Wilmar’s agri-processing core business and there may be concerns on management losing focus.”


 

Singapore October visitor arrivals surge 16% to 978,000

Singapore attracted 978,000 visitors in October, a 16% increase from a year earlier, the Singapore Tourism Board said in an e-mailed statement today. Tourism receipts in the first nine months of the year increased 47% to $13.7 billion from a year earlier, helped by the opening of two integrated casino resorts, the board said.

CapitaMalls Asia +1.6%; Mall buy is accretive: JPMorgan

CapitaMalls Asia (JS8.SG) is up 1.6% at $1.9, rising in afternoon trade after the company says it will acquire Queensbay Mall in Penang, Malaysia, for about $275.6 million.

JPMorgan says the deal is accretive, and notes while the mall's current NPI yield is only 5.0%, it has been undermanaged with occupancy of about 91.5% and passing rents at less than CMA's other Penang mall, Gurney Plaza.

"Given 70% of the leases will be up for renewal in the next two years, we see potential for CMA to leverage on its scale and expertise to upgrade the mall and to achieve a yield on cost of about 7.5%-8.0% by 2012."

JPMorgan says CMA can potentially achieve IRR of about 12% on this acquisition, adding about $0.03/share to RNAV estimates.

The house adds, the stock is at "an attractive entry level," trading at a 30% discount to SOTP valuation and 1.2x FY10E book.

 

Keppel +0.8%; Order flows to help re-rating: RBS

Keppel Corp (BN4.SG) extends its gains slightly and is up 0.8% at $10.80 vs up 0.4% to $10.76 midday, as a US$180 million ($236 million) rig contract from new customer Jasper Investments (FQ7.SG) piques interest.

The contract value could double to US$365 million if Jasper exercises an option for an additional rig. “We believe Keppel’s shares will continue to re-rate as order flows increase,” says RBS, which has a Buy call and a $13 target; “consensus is still in the process of factoring in the full extent of potential Petrobras orders or the increase in demand for high-end jack-ups.”

Keppel’s initial rig is slated for delivery in 2H12 and brings the total value of new orders secured this year to $3 billion. The $11 resistance level, which hasn’t been breached this month, is likely to hold.

SembMarine target lifted to $6.08 by DBS Vickers

DBS Vickers keeps Sembcorp Marine (S51.SG) at Buy and raises the target price to $6.08 from $5.48 to factor in the rig-builder’s latest US$400 million ($525 million) contract win in its valuations.

The house says the new orders from Noble Corp. (NE), which has also awarded options to build four more rigs for another US$800 million, bode well for SembMarine; “this design should strengthen SembMarine’s niche and track record for premium jack-ups operating in a harsh water environment, leading to more contract wins of similar design.”

Expects SembMarine to get more than US$4.5 billion worth of orders next year. Shares are +1.8% at $5.08.

Keppel to build $236m KFELS B Class jackup for Jasper

Keppel FELS Limited (Keppel FELS) says it has secured an order for a KFELS B Class jackup rig worth about US$180 million ($236 million) from Jasper Investments Limited (Jasper), with an option for another similar unit. The rig is slated for delivery in 2H2012. If exercised, the option for the additional rig will bring the total contract value to about US$365 million.

CapitaMalls Asia to acquire Penang's Queensbay Mall for $273m

CapitaMalls Asia says it will acquire Queensbay Mall in Penang, Malaysia, for about RM651.8 million ($272.8 million).

The acquisition will be carried out through CapitaMalls Asia’s subsidiaries and an asset-backed securitisation structure.

CapitaMalls Asia will acquire about 90.7% of the mall’s retail strata area (about 916,181 sq ft) and all its car park spaces. With net lettable area (NLA) of the strata spaces of about 892,361 sq ft, the purchase price is equivalent to about RM730 ($306) per sq ft of NLA.

Queensbay Mall is Penang’s largest mall, conveniently located at Bayan Lepas along the south-eastern shorefront of Penang island and about 20 minutes’ drive from Penang International Airport. It is a family lifestyle mall located at the heart of a 73-acre prime waterfront integrated development which comprises a hotel, a wide range of residential homes and planned office towers. It is easily accessible from the north of the island via the Jelutong Expressway, and from the south via the Bayan Lepas Expressway.

Queensbay Mall’s central location, excellent transport links and proximity to the Penang Bridge and Bayan Lepas industrial hub in Penang’s Free Trade Zone allow it to serve about 1.6 million people on Penang island and the peninsula mainland. The mall’s accessibility will be further enhanced in the future with the planned development of the proposed second link bridge from the south of Penang island to Seberang Prai on the mainland.

This will be CapitaMalls Asia’s second mall in Penang and fourth in Malaysia. The other three malls – Gurney Plaza in Penang, an interest in Sungei Wang Plaza in Kuala Lumpur, and The Mines in Selangor – are owned through CapitaMalls Asia’s stake in CapitaMalls Malaysia Trust.

Boustead scales down investment in Bio-Treat Technology

Boustead Singapore says it is not going ahead with the acquisition of redeemable convertible notes and shares of Bio-Treat Technology.

Earlier, subsidiary Boustead Knowledge, had agreed to purchase 100 million Bio-Treat shares from Giant Delight Holdings Limited (GDL) at the price of 4 cents each.

Boustead says it decided to scale down its investment after Bio-Treat announced a rights issue of up to 992,236,440 new shares at 4 cents each to raise funds.

“Assuming that the Rights Issue is sufficiently taken up by Bio-Treat’s existing shareholders, the Company understands that Bio-Treat’s requirement for investment would be reduced and less capital would be required,” says Boustead in an SGX statement.

In addition, Boustead says the proposed issue of the notes by Bio-Treat to GDL has been delayed due to regulatory concerns.

Adventus unit terminates acquisition of New Zealand coal mine

Adventus Holdings unit Adventus NZ says it is terminating a sale and purchase agreement signed with Medha International.

This was because less than 8 million tonnes of recoverable coal reserves were found by its geologists as agreed upon under the deal.

Adventus says it is taking steps to recover the deposit of US$1 million ($1.3 million).

Zeon to build synthetic-rubber factory in Singapore

Zeon Corp. plans to build a plant in Singapore to make synthetic rubber for tires. The Japanese company plans to begin production in July 2013, according to a statement on its website today.

 

Keppel Corp may extend gains on $236m rig job

Keppel Corp. (BN4.SG) may extend its gains following the company's midday announcement of a US$180 million ($236 million) contract to build a jack-up rig for Jasper Investments (FQ7.SG).

The deal comes with an option for an additional rig, which would double the entire contract value to US$365 million.

The initial rig is slated for delivery in 2H12 and brings the total value of new orders secured by Keppel this year to $3 billion.

The news follows rival SembMarine's (S51.SG) pre-market announcement today of a US$400 million contract to build 2 rigs for Noble Corp. (NE), and affirms the recent sector-wide pick-up in orders for high-specification rigs as oil companies replace their older fleet and upgrade some to meet higher safety standards.

Keppel shares are +0.6% at $10.78 midday. The $11.00 resistance level, which hasn't been breached this month, is likely to hold.

Wilmar target cut to $6.73 from $7.49 by Daiwa

Daiwa cuts Wilmar’s (F34.SG) target price to $6.73 from $7.49, based on a lower 14.4x FY11 P/E vs 16.2x FY11 P/E previously, to reflect its concerns over the agribusiness group’s venture into the real estate business.

“We believe investors will see this as a strategic divergence from its core (business), will raise concerns that the company is running out of investment opportunities in its core business, and have investors questioning why Wilmar is being used for this project.”

But keeps its Outperform call as it thinks the surprise 3Q10 operating loss in Wilmar’s oilseed division is a one-off event; “we think that the subsequent quarter’s results will validate our view and cause investors to raise their expectations for the FY11 net profit.”

Shares are down 4.4% at $5.66.

GMG Global down on Ivory Coast jitters

Shares of rubber producer GMG Global <GMGG.SI> fell as much as 8.3% on Wednesday as investors were nervous about the political unrest in Ivory Coast, where the firm has processing operations.

At 2:41 p.m., GMG Global shares were down 6.7% at $0.28, the lowest in more than two months, on a volume of 102.3 million shares.

“With the political uncertainty in Ivory Coast, there are concerns whether the international community might impose economic sanctions on the country. All in, it worked to the detriment of GMG Global,” said a local analyst.

“The bulk of its plantations is mainly in Cameroon, but in terms of processing capacity it does have a more significant exposure in Ivory Coast. Investors have gotten jittery,” he added.

Ivory Coast’s incumbent leader Laurent Gbagbo on Tuesday invited an international committee to re-examine the results of a disputed election, to avoid a bitter power struggle with his rival escalating into civil war.

GMG Global said its production facilities have not been affected and the delays in shipment are not expected to have material impact on its financials for the year ending December 31.

The firm has an annual processing capacity of 36,000 tonnes in Ivory Coast, according to its website.

STI up 0.3% to 3,150.57 as at trading break

Singapore’s Straits Times Index gained 0.3% to 3,150.57 as of the 12:30 p.m. trading break. Four stocks advanced for each that fell in benchmark equity index of 30 companies.

Shares on the measure trade at an average 15.3 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to data compiled by Bloomberg.

The following shares were among the most active in the market. Stock symbols are in parentheses after the company name.

Commodity suppliers: The Thomson Reuters/Jefferies CRB Index, which tracks prices of 19 commodities from copper to corn, gained 0.8% in New York yesterday, extending its three- day advance to 3%.

Noble Group (NOBL SP), a Hong Kong-based commodities supplier, gained 1.5% to $2.10. Olam International (OLAM SP), a Singapore-based supplier of agricultural commodities, increased 1% to $3.13.

Hengxin Technology (HENG SP), a supplier of coaxial cables used in mobile communications, advanced 2.7% to 38 cents. The company said it will raise net proceeds of $16.1 million from the sale of its shares and proposed listing on the Stock Exchange of Hong Kong.

Sembcorp Marine (SMM SP), the world’s second-biggest oil rig builder, climbed 1.8% to $5.08. The company said it won an order two build two jack-up rigs, valued at US$400 million ($524 million), from Noble Corp., the world’s third-largest deep-water oil and gas driller.

Wilmar International (WIL SP), the world’s biggest palm-oil trader, slumped 4.2% to $5.67. The company said it will invest 889.2 million yuan ($175.7 million) in a joint venture with Kerry Properties (China) and Shangri-La China to develop a hotel in China’s Liaoning province.

“We believe that the market may take this announcement negatively,” Goldman Sachs Group Inc. analysts Patrick Tiah and Nikhil Bhandari wrote in a note to clients today. “This appears to be a sharp departure from Wilmar’s agri-processing core business and there may be concerns on management losing focus.”

Singapore stocks up at midday but Wilmar falls; seen range-bound

Singapore shares rose on Wednesday, but Wilmar International (WLIL.SI), the world’s largest listed palm oil firm, underperformed the broader market due to its property ventures in China that traders said deviate from its main business.

By the midday break, the Straits Times Index (STI) <.FTSTI> was up 0.34%, or 10.72 points, at 3,150.57. Total value of shares traded in the morning session was $605.4 million, up from $461.5 million on Tuesday.

“The local market is tracking the overnight advance from Wall Street. Oil prices continued to stay firm and that has resulted in better performance from our rig players,” said Ng Kian Teck, an analyst at SIAS Research.

He added that he sees the STI trading in a range of between 3,144 and 3,158 points after the midday break.

Wilmar shares fell as much as 5.1% after it said it will invest 889.2 million yuan ($175 million) in joint ventures with Kerry Properties and Shangri-La China to develop three sites in Yingkou City, China, for residential, commercial and hotel use.

At midday, Wilmar shares were down 4.2% at $5.67 on a volume of 24.2 million shares.

“Wilmar has been in the agriculture business, and all of a sudden they want to do something in property, that’s why the market reacted badly,” said Jasmine Lee, an analyst at Phillip Securities.

She added that recent property cooling measures by the Chinese government may also have dampened investor sentiment about Wilmar’s foray into the real estate market.

Shares of rig-maker Sembcorp Marine (SCMN.SI) rose as much as 2% after it won contracts worth US$400 million from Noble Corporation (NE.N) to build two jackup rigs, with options for another four that could lift the total value to US$1.2 billion.

At midday, Sembcorp Marine shares were up 1.8% at $5.08 on a volume of 2.4 million shares, around 40% of  its average traded volume in the last 30 days.

SembMarine target raised by DMG to $5.30 on new orders

DMG raises SembCorp Marine’s (S51.SG) target to $5.30 from $4.70 and maintains its Neutral rating.

After SembMarine announced an order win from Noble Corp for two premium jackup rigs valued at US$400 million ($525 million) plus options for four more, the house estimates that SembMarine’s total outstanding order book is now around US$5.3 billion, with deliveries stretching up to 2Q 2013.

DMG raises its FY11-12F EPS estimates by 4.0% and 10% respectively to reflect the new jackup orders from Noble and higher margins on repeat orders.

Says its new SOTP target is valued at 19x FY11 P/E and FY12 P/E.

“We maintain Neutral given the limited upside of 6.0% from its last closing price and current valuation is already reflecting an upcycle for the rig building sector. Key upside risks are better-than-expected new order wins and stronger margins on new orders.” Its shares are up 1.8% at $5.08.

Sembcorp Marine up on US$400m order wins

Shares of rig-maker Sembcorp Marine (SCMN.SI) rose as much as 2% after it won two contracts worth US$400 million ($525 million) from Noble Corporation (NE.N) to build two jackup rigs, with options for  another four that could lift the total value to US$1.2 billion.

At 11:23 a.m., Sembcorp Marine shares were up 1.8% at $5.08 on a volume of 2.2 million shares, nearly 40% of its average traded volume in the last 30 days.

“They had stuck to their guidance from the beginning of the year and they had delivered on what they said they would,” said Ashwin Sanketh, a CLSA analyst.

“Especially with lots of uncertainty with Petrobras, Sembcorp Marine has been getting other orders. Investors are reconfirming in their own minds that the company is capable of executing its guidance,” he added.

Brazilian shipyard Estaleiro Atlantico Sul submitted the lowest bid in a tender for the building of seven drilling rigs for Petrobras (PETR4.SA), the Brazilian state-run oil company said in November.


 

Wilmar down 4%; Corporate discipline fear: DMG

Wilmar (F34.SG) extends its fall, and is down 4% at $5.69 as investors take a dim view of the group’s foray into the property market.

DMG says “while the investment amount of US$134 million ($176 million) is small...and we have no doubt about the eventual profitability of the project...the entry into the property market represents Wilmar’s first ever deviation from its core agribusiness.” House fears this could mark the start of a “loss of business focus and corporate discipline.”

However, DMG maintains its Buy call and says the stock is inexpensive at 13.5x CY11 earnings. Orderbook suggests the downside today is likely to be limited around $5.60, while the group’s solid core should cushion further declines; CLSA says “in spite of our lack of excitement (over the property venture)...Wilmar provides investment exposure to the rising commodity prices and concerns about the impact of China’s price controls have already been reflected (the) share price.”

Tuan Sing +14.9%; Still at steep discount to NAV

Tuan Sing (T24.SG) is +14.9% at $0.27 on strong volume. Traders cite a column in today's Business Times paper, highlighting the property group as an undervalued stock, as a reason for the jump.

Even at the current price, the stock trades at only 0.6x P/B, one of the lowest for Singapore developers.

Interest picked up even before today’s run-up, with the shares +9.3% since beginning December following Tuan Sing's success with 2 property acquisitions in Singapore: $99.1 million for Serene House and $123 million for a land parcel, both of which will be developed into housing projects.

The company is also deemed a beneficiary of the growing interest in Singapore‘s office market, as it owns 2 properties in the central business district. Resistance is expected at $0.30, last tested in May 2008.

Tuan Sing up on newspaper article it is undervalued

Shares of Tuan Sing (TSHS.SI), a property, hotel investment and industrial services firm, rose as much as 12.8% on Wednesday after the Business Times argued it was undervalued given its growth and earnings potential.

At 10:11 a.m., Tuan Sing shares were up 10.6% at $0.26 on a volume of 12.6 million shares.

“People only wanted to buy familiar names -- the most liquid, active names -- initially, then when they had loaded enough they go searching for things that are off the radar,” said a local trader.

Tuan Sing recently said it had secured a 99-year leasehold land parcel at Seletar Road, Singapore, for $123 million. It has also won the tender for Serene House at the price of $99.1 million.

Kim Eng said in a report last week that Tuan Sing stock was trading at only around 0.5 times its net asset value, which deeply undervalued its investments in Singapore and Australia.

The brokerage added that Tuan Sing has a strong balance sheet, with net cash position of $19 million and $204 million in cash balance.


 

IIFL sees green shoots for Singapore banks

IIFL says Singapore banks are the cheapest in the Asean region with 1.2x-1.6x forward P/B, 10x-12x forward P/E and dividend yield of 4%-5% after they underperformed their regional peers this year.

The house says such underperformance was mainly due to the overhang of NIM contraction, as Sibor declined by 24 bps during 2010 to a 23-year low.

“However, data indicate SIBOR should stabilise at the present level, before inching up next year,“ as rates are hardening across the region.

Last month across Asia, 10-year G-Sec yields rose 10-60 bps amid rising concerns about inflation; in the past month, the yield on Singapore’s 10-year G-sec firmed by 46bps.

It adds, a higher Sibor will lead to the re-rating of Singapore banks. House’s top picks are OCBC (O39.SG), rated Buy, for its wealth management franchise and overseas operations, and DBS, (D05.SG), also rated Buy, for its turnaround potential.


 

Dec 27-31

TUESDAY, DEC 28

Singapore
Joyas Int'l Holdings Ltd
Rights: 2R1WTS for 1 share offer of 2 for 1 @ HK$0.01

Read more...

STI up 0.4% to 3,152.41 as of 9:15 a.m.

Singapore’s Straits Times Index gained 0.4% to 3,152.41 as of 9:15 a.m. Twenty-six stocks advanced, while two fell in benchmark equity index of 30 companies.

Shares on the measure trade at an average 15.3 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to data compiled by Bloomberg.

The following shares were among the most active in the market. Stock symbols are in parentheses after the company name.

Commodity suppliers: The Thomson Reuters/Jefferies CRB Index, which tracks prices of 19 commodities from copper to corn, gained 0.8% in New York yesterday, extending its three- day advance to 3%.

Noble Group (NOBL SP), a Hong Kong-based commodities supplier, gained 1.5% to $2.10. Olam International (OLAM SP), a Singapore-based supplier of agricultural commodities, increased 1% to $3.13.

Sembcorp Marine (SMM SP), the world’s second-biggest oil rig builder, climbed 1.4% to $5.06. The company said it won an order two build two jack-up rigs, valued at US$400 million ($525 million), from Noble Corp., the world’s third-largest deep-water oil and gas driller.

Sound Global (SGL SP), a provider of waste-water treatment services in China, rose 1.2% to 83 cents. The company said it appointed Jin Zhijun as its new chief executive officer.

Wilmar International (WIL SP), the world’s biggest palm-oil trader, dropped 1.9% to $5.81. The company said it will invest 889.2 million yuan ($176 million) in a joint venture with Kerry Properties (China) and Shangri-La China to develop a hotel in China’s Liaoning province.

“We believe that the market may take this announcement negatively,” Goldman Sachs Group Inc. analysts Patrick Tiah and Nikhil Bhandari wrote in a note to clients today. “This appears to be a sharp departure from Wilmar’s agri-processing core business and there may be concerns on management losing focus.”

Wilmar down on property ventures

Shares of Wilmar International (WLIL.SI), the world’s largest listed palm oil firm, fell as much as 2.4% on Wednesday after it said it will invest around 889.2 million yuan ($175 million) in property joint ventures in China.

At 9:11 a.m., Wilmar shares were down 2.2% at $5.79 on a volume of 3.6 million shares.

Wilmar said on Tuesday it had entered joint ventures with Kerry Properties and Shangri-La China to develop three sites in Yingkou City, China, for residential, commercial and hotel use, citing growing demand for such properties in lower tier cities.

However, DMG & Partners Research said the entry into the property market represents Wilmar’s first ever deviation from its core agribusiness.

“We fear this could mark the start of Wilmar’s loss of business focus and corporate discipline and do not think the venture will be well received by the market,” DMG said in a report.

But the brokerage maintained its “buy” call as it viewed Wilmar as inexpensive at 13.5 times 2011 earnings.

Phillip Securities separately has upgraded Wilmar to “buy” from “hold” and maintained its target price of $7.08.

Phillip said Wilmar’s share price has underperformed the broader market as the firm’s 2010 earnings are expected to be weaker due to a squeeze in its margins, as well as higher feedstock prices and recent price caps on consumer pack edible oils.

However, the brokerage said most of the negative developments have already been priced in and it did not expect price control to be long-drawn.

Wilmar International said it will invest US$27.5 million ($36.1 million) into joint ventures with UK-based PZ Cussons Plc to set up a  palm oil refinery and food ingredients business in Nigeria.

Phillip said it viewed this collaboration positively because of Wilmar’s experience in the edible oil industry and Cussons’ extensive distribution network in Nigeria.

The brokerage added that palm oil accounts for 57% of Nigeria’s vegetable oil production and the country has plans to be self-sufficient in the edible oil sector.

Oil trader Hin Leong to set up Singapore's 4th refinery

Singapore’s biggest local oil trader Hin Leong Trading is teaming up with one of China’s top four national oil firms and possibly a European partner to set up a US$6-8 billion ($7.9-$10.5 billion), 300,000-500,000 barrel-per-day refinery in the city-state, the local press reported today.

The planned greenfield project, for which memoranda of understanding have been signed, will be located on Jurong Island and will make Singapore the world’s third largest oil refining and trading hub after Houston and Rotterdam, it was reported.

The refinery, meant to produce green fuels such as ultra-low sulphur gasoline, diesel and naphtha, is to be located next to Hin Leong’s $750 million Universal Terminal (UT) in the island’s Meranti sector, the press reported.

The UT facility will provide the refinery more operational efficiency, giving immediately available tankage both for crude oil feedstock and refined products as well as jetties for very large crude carriers (VLCCs) and product tankers.

The city-state already has three refineries -- Exxon Mobil’s (XOM.N) 605,000 bpd, Shell’s (RDSa.L) 500,000 bpd, Singapore Refining Co’s 290,000 bpd.

As PetroChina (601857.SS) already has a 35% stake in UT and a stake in Singapore Refining, it implies one of the other three top Chinese national oil firms -- SinoChem (600500.SS), Sinopec or CNOOC -- could be involved in the refinery plan, the reports said.

SembMarine +1.6%; Noble likely to order more: RBS

SembMarine (S51.SG) is +1.6% at a 4-session high of $5.07 on optimism over the rig builder’s growing orderbook, which could expand by up to US$1.2 billion ($1.6 billion) if repeat customer Noble Corp. (NE) exercises its options under their latest contract.

The drilling group has just awarded US$400 million orders to SembMarine to build 2 rigs and options for another 4.

“Noble has previously stacked 10 of its older jack-ups and, given the high demand for high-end jack ups in the market, we believe we can expect Noble to carry out its options on the additional four rigs next year,” says RBS, which has a Buy call with a $5.50 target.

JPM, which has an Overweight call with a $5.30 target, says SembMarine has met its 2010 goal of $3 billion new orders. Resistance is at the $5.20 52-week high.

Wilmar down 3%; Losing focus: Analysts

Wilmar (F34.SG) is down 3% at a 6-month low of $5.74 on concerns the group may be losing its focus as it ventures into property development in China with Kerry Properties (0683.HK) and Shangri-la Asia (0069.HK).

OSK, which has a Buy call with a $7.35 target, says while the project in Liaoning’s Yingkou City would be profitable given the expertise of Wilmar’s partners, “this could mark the start of Wilmar’s loss of business focus and corporate discipline.”

Citigroup, which has a Hold call and a $6.76 target, expects Wilmar to bid for more sites in China. “We agree that Wilmar can leverage on its existing contacts and network, but we are not entirely comfortable with the fact that they are expanding beyond the consumer food-related business.”

The companies will jointly develop residential and commercial properties and a hotel in Yingkou. Near-term support is at $5.60 (June 30 low).

SembMarine bags US$400m contract to build 2 jackup rigs for Noble

Sembcorp Marine’s subsidiary Jurong Shipyard has secured two turnkey contracts with a combined value of up to US$400 million ($525.2 million) to build two jackup rigs with options for another four jackup rigs from a subsidiary of Noble Corporation.

If all four of the options are exercised, the total estimated value of the six jackup rigs is expected to be in the region of US$1.2 billion.

Scheduled for delivery in the fourth quarter of 2012 and second quarter of 2013 respectively, these two new turnkey units will be built based on the upgraded Friede & Goldman JU2000E design to be named Friede & Goldman JU3000N. These rigs will be suitable for operations in many challenging environments, including high temperature areas such as the Middle East and in the North Sea.

The new JU3000N design is the result of the combined development efforts of Jurong Shipyard, Noble and Friede & Goldman in creating an enlarged hull that will offer more operational benefits, including ergonomic and efficient accommodation layout, increased deck space and placement of equipment that will allow the crew to efficiently and safely carry out maintenance duties. On completion, these new rigs will be capable of operating in waters of 400 feet and drilling depths of 30,000 feet.

Dec 22: SembMarine, Sound Global, Wilmar

Singapore shares were expected to open higher on Wednesday after Wall Street rose overnight as solid earnings and a flurry of merger activity underpinned a steady upward trend that reinforced investor optimism for the coming year.

The following companies may have unusual price changes in Singapore trading today. Stock symbols are in parentheses, and share prices are from the previous close. Singapore’s Straits Times Index gained 0.2% to 3,139.85.

Commodity suppliers: The Thomson Reuters/Jefferies CRB Index, which tracks prices of 19 commodities from copper to corn, gained 0.8% in New York yesterday, extending its three- day advance to 3%.

Noble Group (NOBL SP), a Hong Kong-based commodities supplier, gained 1.5% to $2.07. Olam International (OLAM SP), a Singapore-based supplier of agricultural commodities, increased 2% to $3.10.

Palm-oil producers: Crude palm-oil futures for March delivery climbed 1.2% yesterday in Kuala Lumpur, extending its two-day advance to 1.7%.

Golden Agri-Resources (GGR SP), the world’s second- biggest palm-oil producer, increased 1.3% to 76.5 cents. First Resources (FR SP), an Indonesian palm-oil producer, advanced 2.8% to $1.45. Indofood Agri Resources (IFAR SP), the palm-oil unit of Indonesia’s biggest noodle maker, gained 1.9% to $2.73.

Food Junction Holdings (FOOD SP): The Singapore-based food-court operator said its subsidiary signed an agreement to lease commercial space in Lippo Plaza in Shanghai, China, where it plans to open a restaurant. The stock was unchanged at 22 cents.

Sembcorp Marine (SMM SP): The world’s second-biggest oil rig builder said it won an order two build two jack-up rigs, valued at US$400 million ($525.2 million), from Noble Corp., the world’s third-largest deep-water oil and gas driller. Sembcorp Marine gained 1.4% to $4.99.

Sound Global (SGL SP): The provider of waste-water treatment services in China said it appointed Jin Zhijun as its new chief executive officer. The shares slipped 1.2% to 82 cents.

Wilmar International (WIL SP): The world’s biggest palm-oil trader said it will invest 889.2 million yuan ($176 million) in a joint venture with Kerry Properties (China) and Shangri-La China to develop a hotel in China’s Liaoning province. Wilmar lost 0.5% to $5.92.

United Fiber System (UFSL.SI), a firm with forestry and pulp as well as construction businesses, said on Tuesday it had terminated a joint venture agreement with TSGA Asia, an affiliate of the Sandi Group, to construct a social housing project in Libya.

Hengxin Technology (HNGX.SI), which manufactures telecommunications cables, said the final number of offer shares in its placing for its dual listing on the Hong Kong Stock Exchange was 88.8 million shares. The firm expected to debut in Hong Kong on December 23 and raise net proceeds of around HK$95 million ($16 million).

Indonesian authorities evaluating Temasek assets for seizure

Indonesia’s anti-monopoly agency is evaluating Temasek Holdings Pte’s assets in the country and said the government has the right to seize them if a court-imposed fine isn’t paid.

The Singapore state-owned investment company lost its final appeal in the Supreme Court on May 24 for violating antitrust laws, the Indonesian court said on its website at the time. A fine of 150 billion rupiah ($22.4 million), which includes 15 billion rupiah for each of 10 Temasek-linked companies involved in the case, was set, the anti-monopoly agency said.

“We’re now inventorying Temasek’s assets and expect to complete that in 2011, and they will be seized if the fine isn’t paid,” Tresna Soemardi, agency’s chairman, said in a phone interview today.

The Indonesian competition regulator KPPU has said Temasek breached antitrust laws by using indirect stakes in PT Telekomunikasi Selular, known as Telkomsel, and PT Indosat, the country’s top two mobile-phone service providers, to fix prices.

“Temasek has not received official notification from the Supreme Court,” Goh Yong Siang, Temasek’s senior managing director of strategic relations, said in an e-mailed response to queries.

Calls to the Supreme Court after office hours weren’t answered.

“Once the company has been formally notified of the fine and doesn’t pay it, the Indonesian anti-monopoly commission may ask for a court order to seize the assets,” Muhammad Reza, the agency’s chief of investigations, said by phone.

Temasek’s Singapore Technologies Telemedia Pte unit sold its stake in Indosat, Indonesia’s second largest mobile-phone services provider, to Qatar Telecom QSC in June 2008 after an earlier district court ruling. A unit of Singapore Telecommunications Ltd., Southeast Asia’s biggest phone operator and majority owned by Temasek, has a 35 percent stake in Telkomsel, the biggest mobile carrier.

Koran Tempo first reported the possible seizure of Temasek’s assets today.

Indonesia's anti-trust agency seeks $17.1m from Singapore

Indonesia’s anti-trust agency (KPPU) is seeking ways to seize assets worth 120 billion rupiah ($17.1 million) from Singapore’s Temasek Holdings (TEM.UL) over an outstanding fine of the same amount, a KPPU commissioner said on Tuesday.

The KPPU ruled in 2007 that Temasek and eight affiliates were in breach of Indonesia’s anti-monopoly laws because of holdings in two Indonesian telecom firms, and ordered Singapore’s state investor to sell the stake in one while fining the affiliates 15 billion rupiah each.

Indonesia’s supreme court rejected a final appeal from Temasek to overturn the ruling in May this year.

“We’re working with the central Jakarta district court to gather data for the plan,” said Erwin Syahril, a KPPU commissioner, in a phone interview with Reuters.

“If they don’t want to pay, then we have to seize assets worth as much as the fine,” he said adding the agency had not set a deadline for the recovery.

Temasek, through its units, sold a stake in PT Indosat Tbk (ISAT.JK) in 2008 but retains a significant shareholding in PT Telkomsel, a unit of PT Telekomunikasi Indonesia  (TLKM.JK).

The company said it was not officially aware of the move.

“Temasek has not received official notification from the Supreme Court,” said Mr Goh Yong Siang, Senior Managing Director, Strategic Relations at Temasek.

Temasek also controls PT Bank Danamon (BDMN.JK), Indonesia’s sixth biggest lender, through a consortium including Deutsche Bank (DBKGn.DE).

Wilmar International signs JV deal with partners to develop properties in China

Wilmar International says wholly-owned subsidiary, WCA Pte. Ltd. (WPL), has entered into a master joint venture agreement with Kerry Properties (China) Limited (KPCL) and Shangri-La China Limited (SACL) to establish joint venture companies for real-estate development, operation, sale, leasing, property management and hotel development, operation and management in Bayuquan, Yingkou City, Liaoning Province, China.

Wilmar says the demand for quality residential, commercial and hotel property in the second and third-tier cities in China is expected to experience strong growth in the future. The company says its main contribution to the JV will be the sourcing of suitable sites.

The shareholdings of WPL, KPCL and SACL in the JVCO(s) are in the proportions of 35%, 40% and 25% respectively. Wilmar’s investment in the JVCO(s) for the project sites is RMB889.15 million, based on the maximum total investment in the JVCO(s) of RMB2,569 million.

Funding for the JVCO(s) will be from internal sources of funds and bank borrowings. The investment in the JVCO(s) for the Project Sites is not expected to have a material impact on Wilmar’s financial position.

Wilmar, KPCL and SACL entered into the Master JVA following their first successful joint bid for three sites in Bayuquan, Yingkou City, Liaoning Province, China, for a total cash consideration of RMB240 million ($47.3 million).

The project sites are designated for residential, commercial and hotel use and have a total gross site area of 200,000 square metres. The terms for the grant of the land use rights of the Project Sites are 70 years for residential and 40 years for commercial (hotel) use.

STI closes 0.2% higher at 3,139.85

Singapore’s Straits Times Index gained 0.2% to 3,139.85 at the close. Two stocks rose for each that fell in benchmark equity index of 30 companies.

Shares on the measure trade at an average 15.3 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to data compiled by Bloomberg.

The following shares were among the most active in the market. Stock symbols are in parentheses after the company name.

Commodity suppliers: The Thomson Reuters/Jefferies CRB Index, which tracks prices of 19 commodities from copper to corn, gained 1.1% in New York yesterday, extending its two-day advance to 2.2%. Olam International (OLAM SP), a Singapore-based supplier of agricultural commodities, increased 2% to $3.10. Noble Group (NOBL SP), a Hong Kong-based commodities supplier, gained 1.5% to $2.07. Noble also advanced after the company agreed to buy sugar mills in Brazil for US$950 million ($1.25 billion), including debt, to increase its production of the sweetener by 81%.

Palm-oil producers: Crude palm-oil futures for March delivery climbed for a second day in Kuala Lumpur today. Golden Agri-Resources (GGR SP), the world’s second-biggest palm-oil producer, increased 1.3% to 76.5 cents. First Resources (FR SP), an Indonesian palm-oil producer, advanced 2.8% to $1.45. Indofood Agri Resources (IFAR SP), the palm-oil unit of Indonesia’s biggest noodle maker, gained 1.9% to $2.73.

Genting Singapore Plc (GENS SP), part of Malaysia’s Genting Bhd., rose 1.4% to $2.11. Genting’s Resorts World Sentosa and Marina Bay Sands may post US$2.8 billion ($3.7 billion) in casino revenue this year and US$5.5 billion in 2011, Today reported, citing PricewaterhouseCoopers LLP.

Singapore Airlines (SIA SP), the world’s second- biggest carrier, increased 0.9% to $15.32. Goldman Sachs Group Inc. reiterated its “buy” rating on the company even as it lowered its rating on the airline sector to “neutral” from “attractive.”

XinRen Aluminum Holdings (XAH SP), a China-based producer of the metal, rose 1% to 50 cents. The company said it plans to triple its annual production capacity to 150,000 tonnes by the end of 2011.

Wilmar forms venture with Kerry Properties, Shangri-La China

Wilmar International said a unit signed an agreement with Kerry Properties (China) and Shangri-La China to set up joint ventures to develop properties in China’s Liaoning province. The unit’s investment in the venture will be about 889.2 million yuan ($176 million), based on a maximum total investment by the venture of 2.57 billion yuan.

Genting Malaysia, partner exploring opportunities in Vietnam

Genting Malaysia Bhd., a casino and hotel group, said it has been collaborating with a partner to explore for opportunities in Vietnam, according to a company statement today. The company was responding to media reports that the Genting group and Vina Capital has received government approval for a casino resort project in Hoi An city.

ST Engineering unit wins contract to supply automatic fare collection system for Bangkok MRT

ST Electronics says it has been awarded a contract to supply an Automatic Fare Collection System (AFCS) for the extension of the Bangkok Mass Transit System (BTS) Sukhumvit Line in Bangkok, Thailand.

The contract was awarded by The Krungthep Thanakom Company Limited (KT), a Bangkok Metropolitan Administration Enterprise.

ST Electronics is the electronics arm of public-listed ST Engineering.

The AFCS for the Sukhumvit Line will be implemented from On Nut Station to Bearing Station (E10 to E14). The extension adds 5.25km to the route length of the existing BTS Sukhumvit Line and includes five new stations.

The AFCS will be delivered by the second half of 2011 for commencement of revenue service.


 

Capital Group raises stake in Amtek Engineering

Amtek Engineering says Capital Group has increased its stake in the company from 5.52% to 6.33%, or from 30 million to 34.4 million shares. The increase by Capital Group follows the open market purchase of 2.9 million shares by Aranda Investments, a wholly-owned subsidiary of Temasek Holdings, on 2 Dec, increasing its stake in the company from 4.86% to 5.39%.

SATS off 0.4%; Earnings tweaked higher on TFK buy

SATS (S58.SG) off 0.4% at $2.83, giving back some of yesterday’s 0.7% gain which came amid a weak market on news the company has completed the acquisition of Japan Airlines International’s entire 50.7% stake in in-flight caterer TFK Corp. for $122 million.

Phillip Securities, which has a Buy call and raises its target to $3.48, says the purchase is a proxy to growth at Japan’s Narita and Haneda airports.

The house raises its earnings estimates for FY11, FY12 and FY13 by 0.6%, 4.4% and 4.6% respectively to account for the acquisition; it estimates TFK will contribute 18.4% of group sales, which could breach the $2 billion milestone in FY12E.

CIMB lifts its FY11-FY13 EPS estimates 1.0%-3.0% to account for the new contributions, but maintains its Underperform call due to rich valuations “and risks of competition in ground handling.”

Its raises SATS’ target to $2.42 from $2.35.

 

SingTel Optus loses bid to halt Vodafone mobile-phone campaign

Singapore Telecommunications’s Australian unit, previously ruled to have misled customers with its data-service advertisements, lost a bid in Sydney federal court to stop Vodafone Group Plc. from publicising its “infinite” mobile-phone plans.

Australia Federal Court Judge John Nicholas today denied SingTel Optus Pty Ltd.’s request for a temporary injunction barring Vodafone from advertising the plans, which offer unmetered calls to fixed-line and mobile-phone numbers for A$45 ($59) a month.

Optus claims Vodafone’s advertising campaign is misleading because it doesn’t sufficiently disclose that customers can’t make unlimited calls to satellite phones, voice mail, 1-800 numbers and directory assistance, according to court documents.

“I have serious doubts as to whether the ordinary and reasonable consumer would understand either of the television commercials as representing that the respondent’s plan allows a user to make an unlimited number of calls of any type,” Nicholas wrote in his judgment.

The Australian Competition and Consumer Commission previously sued SingTel Optus and won an order forcing the company to run corrective ads and pay fines. Federal Court Judge Nye Perram ruled in October that advertisements for Optus’s broadband service promised data services that customers weren’t likely to receive.

XinRen up on plans for 4th smelting plant

Shares of XinRen Aluminum <XIRN.SI>, a Singapore-listed Chinese aluminium producer, rose as much as 3% on Tuesday after a Reuters report that it was looking to build or acquire a fourth smelting plant.

XinRen was up 2% at $0.505 on a volume of 1.4 million shares at 14:25 p.m. It had earlier reached an intraday high of $0.51.

“The continuous search for suitable opportunities to expand its operations is within its normal business practices, given the strong demand for aluminium products across the region,” XinRen said in a filing to the Singapore Stock Exchange.

A senior company executive told Reuters that the location for the fourth smelting plant must be close to resources such as coal due to the firm’s energy-intensive production process, as well as having easy access to transportation and end user markets.

Singapore private home demand may taper off: CLSA

With current housing affordability in Singapore stretched and close to one standard deviation above mean levels, demand for private homes could taper off if household income doesn’t accelerate in tandem with property prices, says CLSA.

It adds, Singapore’s current housing affordability is 7.5x the average annual household income vs the historical average of 6.7x, with prices for the mass-market and mid-end housing segments already 16.7% and 9.0% above their respective peak levels; “although record low mortgage rates can spur sales volume, stretched affordability above historical mean will cap price growth in our view and hence RNAV for developers.”

It says, any additional housing-market curbs from the government could also cap RNAV expansion for residential developers. Prefers developers with exposure to the high-end office and retail segments, such as CapitaLand (C31.SG), Keppel Land (K17.SG) and Fraser & Neave (F99.SG).

STI +0.6% as at 2:47 p.m., 3,167 may cap; No strong drivers: Trader

Positive US stock futures and gains across Asian bourses are expected to keep Singapore shares in positive territory for the rest of the session.

The STI is up 0.6% at 3,151.62 but may face resistance at Friday’s 3,167 high. Market breadth is still at more than 2 gainers for every decliner, although participation remains low with under 500 million shares changing hands.

“The Korea issue seems to have been discounted but there are no strong drivers for the market,” says a local house trader.

The most active stocks are dominated by both large and small caps, including Genting Singapore (G13.SG) +1.9% at $2.12, China Animal Healthcare (EP4.SG) +1.3% at $0.40, China Hongxing Sports (BR9.SG) flat at $0.155, Noble Group (N21.SG) +2.0% at $2.08 and GMG Global (5IM.SG) flat at $0.30.

STI gains 0.4% to 3,143.94

Singapore’s Straits Times Index gained 0.4% to 3,143.94 as of the 12:30 p.m. trading break. Seven stocks rose for every two that fell in benchmark equity index of 30 companies.

Shares on the measure trade at an average 15.3 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to data compiled by Bloomberg.

The following shares were among the most active in the market. Stock symbols are in parentheses after the company name.

Commodity suppliers: The Thomson Reuters/Jefferies CRB Index, which tracks prices of 19 commodities from copper to corn, Gained 1.1% in New York yesterday, extending its two-day advance to 2.2%.

Olam International (OLAM SP), a Singapore-based supplier of agricultural commodities, increased 2% to $3.10. Noble Group (NOBL SP), a Hong Kong-based commodities supplier, jumped 2% to $2.08. Noble also advanced after the company agreed to buy sugar mills in Brazil for US$950 million ($1.25 million), including debt, to increase its production of the sweetener by 81%.

Palm-oil producers: Crude palm-oil futures for March delivery climbed for a second day in Kuala Lumpur today. Golden Agri-Resources (GGR SP), the world’s second-biggest palm-oil producer, increased 1.3% to 76.5 cents. First Resources (FR SP), an Indonesian palm-oil producer, advanced 2.8% to $1.45. Indofood Agri Resources (IFAR SP), the palm-oil unit of Indonesia’s biggest noodle maker, gained 1.9% to $2.73.

Amtek Engineering (AMTK SP), a supplier of precision components to companies such as Sony Corp., rose 0.9% to $1.10. Capital Group LLC raised its stake in the company to 6.3% from 5.5%, Amtek said.

Genting Singapore Plc (GENS SP), part of Malaysia’s Genting Bhd., rose 1.4% to $2.11. Genting’s Resorts World Sentosa and Marina Bay Sands may post US$2.8 billion ($3.7 billion) in casino revenue this year and US$5.5 billion in 2011, Today reported, citing PricewaterhouseCoopers LLP.

Singapore Airlines (SIA SP), the world’s second-biggest carrier, increased 1.6% to $15.42. Goldman Sachs Group Inc. reiterated its “buy” rating on the company even as it lowered its rating on the airline sector to “neutral” from “attractive.”

XinRen Aluminum Holdings (XAH SP), a China-based producer of the metal, rose 2% to 50.5 cents. The company said it plans to triple its annual production capacity to 150,000 tonnes by the end of 2011.