Sembcorp Marine Results Drags Singapore Index Lower

Singapore shares edged lower on Monday, dragged down by losses in Sembcorp Marine Ltd which hit a six-week low after posting lower-than-expected first-quarter earnings.

The benchmark Straits Times Index was down 0.2 percent at 3,245.69 by 0506 GMT. MSCI's broadest index of Asia-Pacific shares outside Japan dipped 0.3 percent.

Shares of Sembcorp Marine fell 2.5 percent to an intra-day low of S$3.96, their lowest since March 21, after the offshore drilling rig builder posted a 3.1 percent increase in first-quarter net profit, which nonetheless undershot market expectations.

CIMB downgraded its rating on Sembcorp Marine to "hold" and cut its target price to S$4.30 from S$5.10, citing a shortfall in ship repair and rig building revenue. "Though 1Q is a seasonally weaker quarter, we believe subsequent ramp-up may not be as strong as we had expected," the brokerage said in a research note. "The sluggish shipping market may cap volume growth in ship repair."

The index was also weighed down by losses in the real estate sector. Losses were led by Global Logistics Properties Ltd and City Development Ltd which fell 1.4 percent and 0.5 percent, respectively.
Among other stocks, Tiger Airways Holdings Ltd plunged as much as 9.2 percent to S$0.395, its lowest in nearly two months.

(By Andrew Toh; editing by Subhranshu Sahu)