It's got a drill rig order terminated by Marco Polo marine for failing to meet contract obligations.
Legal suits probably will follow.

Thanks for the heads-up, prophetjul,... I'll look this up.

I think I could have found out the cause for the plunge of Keppel Cop today. Do you guys believe the following write-up ?

Macquarie Research issued a short report on KC, SCI and SMM today, leading all 3 to sell down.............

Since the Keppel Land privatization last year, KEP is being perceived as a conglomerate, in our view, hence trading at premium to pure O&M play SMM. However, O&M is still KEP’s principal driver, accounting for ~50% of its profits from 2015-17E. On the other hand, the property business, which will make up ~40% of KEP’s profits and ~70% of its BV (2015-17E), is a low-ROE business, in our view. Given declining returns in O&M and shift in revenue mix towards the low-ROE property business, we think KEP’s group ROEs and ROICs are in a structural decline. Even if we assume no cancellations / delays in its O&M order book, we estimate group ROE will fall to 7% by 2019E (from 21% in 2012) and group to ~4% by 2019E (from 12% in 2012). In this scenario, we find it difficult to justify valuing KEP at no discount to BV. After valuing each of KEP’s businesses separately, we derive a valuation of 10% discount to BV, which gives us a TP of S$5.30. We thus downgrade KEP from Outperform to Underperform with 17% stock price downside. While our profit estimates are now ~20% below street for 2016-17E, we see further downside risk if KEP’s O&M orders start getting cancelled. In that scenario, the discount to BV could widen to Korean yard levels (0.3-0.6x). Impact Key risks to the ‘defensive’ perception: Key risk #1: Even if rig orders come back in 2018, KEP will not be at the front of the row: We believe global rig orders will dry up to zero from 2015-17E, and especially jack-ups—a segment that KEP dominates—may have entered a prolonged down cycle due to heavy oversupply. Key risk #2: Current order book is not insulated from cancellations: KEP’s ~S$9bn order book at the end of 2015E has ~70% cancellation / delay risk, in our view (please see detailed analysis on pages 9-11). Key risk #3: High expectations from the property business: Given lumpiness of the business, we are building a long-term model by which we are incorporating robust property profits going to S$552m in 2017E from S$382m in 2014, which could have downside risk. Key risk #4: Dividends fall as balance-sheet pressure builds up: Net debt / equity has increased from 11.2% as at end- 2014 to 59% in 2015E and could get worse if O&M orders get cancelled, hence posing risk to dividend payouts. Earnings and target price revision We reduce our profit estimates for 2016 by 35% and for 2017 by 30%. We are reducing our TP to S$5.30 from S$10.85 earlier. Price catalyst 12-month price target: S$5.30 based on a Price to Book methodology. Catalyst: Order cancellations / delays Action and recommendation 0.9x P/B fair in current circumstances; could move to 0.3-0.6x P/B if orders get cancelled: With a structural decline in returns and more downside risk, the way we value KEP as a conglomerate has to change, in our view.

TP = $5.30 ?????????

hansel, if u missed any of these...

crude <36.
china continued poor data reports.
north korea hydrogen bomb test.

result:

usd/rmb 6.555
usd/sgd 1.434
usd/rm 4.391

This post has been edited by AVFAN: Jan 6 2016, 03:01 PM

i think we will see global recession kicking in around 3rd qtr.

Thank you, AV,...

I have been watching the USD/SGD, and yes, it is quite an depreciation of the SGD vs the USD compared to one month earlier. As for the USD vs the RM, I think it is still 'ard that level'...

I think the USD managed to clawed its way up a bit today because of the so-called earthquake detected by the USGS near the N.Korea nuclear facility. Ignorance towards China's poor data reports is building,... I think,....

Prophet,...things are so hard to tell now,...today's drop could be a knee-jerk reaction from that suspected nuclear test in NK.

I am so tempted to load-up more of Keppel Corp, but still carrying much hesitation.

There is a new point being put out by net residents. Is oil and commodities getting phased out by the world ? Will green energy replace fossil fuel ? If it is going to be so,... there will really be a big shakeup. Oil price will never recover to their glory days again, and oil-related counters will follow suit.

I recalled one experience that I had back in 2008/9. I bought many of my counters back then, and had huge capital gains, and kept them throughout the years till today. Have reaped lots of dividends too. But I made a wrong call on one counter that never got back to its heydays, namely Singapore Airlines.

After the global financial crisis, everybody started taking AirAsia, and SIA could not reach the glory that it used to command before the GFC.

I wonder if the same thing is going to happen to oil price, hence, causing Keppel Corp not to return to its glorydays anymore ?

Not a good day for Keppel, downgrade with TP: 5.80 by Barclays

SINGAPORE (Jan 6): Barclays has lowered its recommendation as well as target price for rig builders SembCorp Marine and Keppel Corp as it forecast new rig orders drying up in 2016 to 2017 and risks to existing orders.

In a research report, Barclays gave SembCorp Marine an "Underweight" rating and slashed its target price by 52% to $1.10. It downgraded Keppel Corp to "Equal Weight" and dropped its target price by 33% to $5.80.

This post has been edited by Vector88: Jan 6 2016, 08:44 PM

aiyoyo...

Hansel, i dun think KEPPEL CORP can return to its glory days unless we see a sharp rebound in oil price...
and future, we are seing ELECTRONIC & SOLAR energy powered vehicles.. hence a slow down in being reliant on O&G.
Even simple task like using OIL FOR FRYING (palm oil not crude oil).. IS BEING replaced by AIR FRYERS..

i don't mean to be cruel...

but i don't see crude price going above usd40 for next 2 (TWO) years.

Blood all over today.

Stocks in my radar:
Keppel almost 6, singtel 3.5, sembcorp 2.8 , singpost 1.5, st eng 2.8x

This post has been edited by Vector88: Jan 7 2016, 10:17 AM

ya, nothing is spared...

only consolation is sgd/rm = 3.08.

what u shopping today?

no... i will wait...

will consider adding to keppel dc and capitamall if price goes below my last acquisition prices.

Hi Elea, AV, Vector and friends,...

Market is crashing,...sentiments are low,... sequence of events :-

1) yesterday morning : Chine pulled the plug on the circuit-breaker, devalued the RMB.
2) last night : All 4 indices in the US closed in the red.
3) this morning: China pulled the plug again on their bourse.

BUT : Tomorrow night : if my memory serves me correctly, it's Friday again, and another Jobs Report again. Will this Jobs Report recover the mkts ?

Almost all counters are falling,........but, for now......I noticed one counter seems to be gaining,...Keppel DC REIT.

Steady,...I'm not loading-up yet,...

year of the fire monkey!

To further diversify your holdings, you can consider holding an SG Bank counter. SG banks are world-class in terms of reserve ratios, hence, very stable and safe.

The SG bank that I am looking at currently is OCBC Bank. It is the cheapest in terms of valuation, and has the highest yield at current pricing. Its DPU grows year-by-year for most of the years.

Take a look,....

I'm vested and still confident with OCBC, current avg price at 8.74 yield around 4.1x%.

here we go: