Monday, October 02, 2006

Stock upgraded: Keppel Corp by Daiwa

Daiwa Institute of Research says it has raised its six-month estimate for the fair value of Keppel Corp stock to 15.60 sgd per share from 15.10 sgd to factor-in higher valuations for the company's oil-related assets. But Daiwa is keeping its "hold" rating for Keppel Corp. "At the current share price, we see little upside potential to our target price, and believe the stock is fully valued in the near term," Daiwa said in a note to clients. "We think there may be further downward pressure on the share price if oil prices remain at current levels over the next few months," it said. However, the research house regards the medium-term outlook for Keppel Corp as bright because it expects demand for offshore oil and gas rigs to remain strong over the next 3-5 years, in view of high energy prices and the aging of the world's fleet of rigs. At 9.05 am, Keppel Corp was down 0.10 sgd or 0.68 pct at 14.70, with 37, 000 shares traded.

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