Stock Upgraded: Sino Env target price raised to 1.78 by UOB Kay Hian

UOB Kay Hian said it has lifted its target price for Sino Environment to 1.78 sgd per share from 1.396 previously as it expects the company to secure more desulphurization deals going forward after it was recently awarded its maiden desulphurisation contract by Xinjiang Changji Power Plant in China. "While the contract value of 62.5 mln yuan is not significant, we believe this is a sign of more contracts to come as Sino Environment teams up with a major power plant operator to win more desulphurization projects," UOB said. "We value the China market for desulphurization facilities at 90 bln yuan over the next five years as new and existing power plants comply with government regulations to reduce sulphur dioxide emission," it added. To factor in the contributions from the initial desulphurization contract, UOB Kay Hian said it has lifted its 2007 net profit estimate for Sino Environment by 4.5 pct and its 2008 net profit estimate by 9.7 pct. At 10.56 am, Sino Environment was up 0.06 sgd or 3.7 pct at 1.68 with 1.5 mln shares traded.