0854 GMT - 8 Feb [Dow Jones] STOCK CALL: Daiwa upgrades SembCorp Industries (U96.SG) to Outperform from Hold and raises its target price to S$5.42 from S$4.22 after its 61%-owned subsidiary SembMarine (S51.SG) announced a US$793 million drillship order from Sete Brasil, turning the house more positive on the rig-order cycle. “We like the company for the growth in its utilities earnings (we forecast a three-year CAGR of 12% for its utilities Ebit for 2011-14), a dividend yield of 5% for both 2012 and 2013, and its exposure to the rigbuilding business.” It estimates excluding SembMarine, SembCorp is trading at 8.7X 2012 PER vs its 10-year average of 9.5X. The stock is up 2.5% at S$5.01.
- Leslie Shaffer, Dow Jones & Company