Company Name: YANGZIJIANG SHIPBLDG HLDGS LTD
| Research House: OCBC | Price Call: HOLD | Target Price: 1.08 |
OCBC Investment Research lowered its target price on shipbuilder Yangzijiang Shipbuilding (Holdings) to $1.08 from $1.23 while keeping its hold rating, citing a dim outlook for the industry.
Shares of Yangzijiang were down nearly 1% at 9:58 a.m. at $1.025 but have risen 12.7% so far this year, outperforming the benchmark Straits Times Index.
Yangzijiang has cancelled a contract with Greek shipowner FreeSeas after it failed to make payments.
Although the contract termination has no significant financial impact on Yangzijiang, it could be a signal of further changes in the shipbuilding industry, OCBC said.
The brokerage noted that Chinese state-owned banks have distributed only US$1 billion ($1.3 billion) in loans to Greek shipowners, which was lower than expected.
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