DBS downgrades China Fishery to 'hold'

Stock Name: China Fish
Company Name: CHINA FISHERY GROUP LIMITED

Research House: DBS Vickers

Price Call: HOLD

Target Price: 0.72

DBS Vickers downgraded China Fishery Group to‘hold’ from ‘buy’ and cut its target price to $0.72 from $1.15, citing greater regulatory risks for its North Pacific operations.

By 11:26 a.m., shares of China Fishery were down 2.6% at $0.75, and have fallen 17.6% so far this year, compared to the FTSE ST Consumer Goods Index's 16.4% decline.

A Russian regulator has expressed concerns over foreign companies establishing control over Russian fishery companies and intends to implement measures to address the issue, which could have an impact on supply of fishes to China Fishery, said DBS.

The brokerage estimated that a 10% drop in the company's fish volumes or sales could have a 9.5% impact on its 2013 earnings.

“We believe regulatory concerns could cap share price performance, at least in the near term," DBS said.