Market Pulse: Ezra Holdings (26 Sep 2011)

Stock Name: Ezra
Company Name: EZRA HOLDINGS LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 1.55

Market Pulse: Ezra Holdings (26 Sep 2011)

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Ezra Holdings: Talk of a potential listing in London

Summary: There are news reports that Ezra may be eyeing a listing in London, but no decisions have been made given the current volatile market. Unless Ezra is in urgent need of funds, it may not be its best interest to do a listing at a time when Aker Marine Contractors (AMC) is still loss-making. The benefits of a listing in London may outweigh the costs for Ezra should it want to expand its operations in Europe, but the timing for a listing would make a lot of difference in terms of funds raised and the signal that it sends to investors as well. We are positive on the long-term outlook of the group as it seeks to become a global leading subsea player but time would be required for a sustained turnaround in the AMC business. Given the stock's upside potential, maintain BUY with a fair value estimate of S$1.55. (Low Pei Han)

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NEWS HEADLINES

- The EU may speed up the start of a permanent rescue fund for their cash-strapped economies amid fresh signs that more urgent efforts are needed to halt the worsening sovereign debt crisis.

-The IMF announced it will provide leadership in the current financial crisis and take 'bold and coordinated' actions to restore confidence and financial stability and rekindle global growth.

- In spite of the growing concerns over the global economy, mergers and acquisitions activity in the Singapore market have held up so far this year and the deal pipeline appears healthy.

- Keppel Telecommunications & Transportation Ltd (KTT) and integrated logistics service firm Sinotrans Ltd will each contribute RMB140m to jointly develop and operate a river port along China's Yangtze River.

- Transcu Group Ltd has obtained a S$6m equity line facility from Singapore-based fund manager AMAC Capital Partners.

- Henderson Industrial Building, a four-storey freehold development at the junction of Henderson Road and Jalan Bukit Merah, has been put up for sale. Offers of over 120m or S$575 psf are expected.