Swiber falls 6%; brokers upbeat on placement

Stock Name: Swiber
Company Name: SWIBER HOLDINGS LIMITED

Research House: CIMB

Price Call: BUY

Target Price: 0.79

Shares in Swiber Holdings fell as much as 6.4% on the Singapore offshore services firm's move to raise about $62.5 million via a share placement, but brokers said it would Swiber cut debt and expand its footprint.

CIMB Research cut its earnings per share estimates for 2012-2014 fiscal years by 5-12% to capture dilution from the share placement, partially offset by higher order wins.

The broker said the funds should help Swiber chase more sizeable projects and break into new markets and raised its order assumption for 2012 to US$600 million ($760 million) from US$500 million.

CIMB cut Swiber's target price to $0.79 from $0.94, but maintained its outperform rating.