The Straits Times / The Business Times News on Cosco

Cosco director cuts stake by nearly half

JUST a day after Cosco Corporation announced a record full-year results, an alternate director of the company has slashed his stake by nearly half with sale of shares on the open market.

Mr Liu De Tian, who is also managing director of Cosco (Singapore), sold 642,000 shares at an average price of $1.29472 on the open market on Tuesday.

This has trimmed his Cosco stake from 1.368 million shares to 726,000 shares, according to Singapore Exchange filings.

But his sale was viewed by some dealers as a prudent move, given Cosco's sharp run-up before its year-end results on Monday.

'Although Cosco has now grown another leg in its business after purchasing a shipyard from its parent in China, there are some concerns that the margins in its bulk carrier business may come under pressure this year,' said one dealer.

With results described as having 'no major surprises' by analysts on Monday, Cosco said that profits had grown 150 per cent to $160.5 million last year, boosted by strong growth in the ship repair business.

Following the results, Kim Eng Research kept its buy call, with a target price of $1.54, arguing that the company's growth will be driven by strong demand for shipyard repairs.

Cosco yesterday ended three cents lower at $1.23 on volume of 10.3 million shares.