Sembcorp’s 3Q results leave analysts unmoved

SINGAPORE (Oct 28): Sembcorp Industries’ 3Q16 results have left analysts with unchanged views, with CIMB and Maybank holding on to their “hold” calls with target prices of $2.66 and $2.40 respectively, while UOB maintain a “buy” call with a target price of $3.05.

All three research houses agree Sembcorp’s 3Q results met expectations, despite being dragged down by poor earnings from its Marine division. Rather, it was the Utilities division that drove earnings, with the $34 million in profits from Singapore operations coming above expectations, notes CIMB analyst Lim Siew Khee. This was due to cogeneration losses narrowing and higher prices of oil and sulphur fuel, which is unlikely to continue in 4Q16.

(See also: Sembcorp posts 56% fall in 3Q earnings to $54 mil on marine division losses and Gallant Venture impairment)

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