The Straits Times / The Business Times News on Cosco

Directors' Trades
2 directors of Cosco units reduce stakes

TWO directors of Cosco Corp units have whittled down their direct stakes in the shipyard and shipping group - at a time when its share price has soared to new highs.

Mr Zhou Xie Dong, director of its China unit, Cosco Shipyard Group, sold 100,000 shares at $2.02 apiece on Tuesday.

This reduced his direct stake from 200,000 shares or 0.009 per cent, to 100,000 shares or 0.005 per cent.

Mr Chen Yong, a director of a subsidiary, Cosco Marine Engineering (Singapore), sold 100,000 shares on the open market at $2.02 apiece on Tuesday, according to a Singapore Exchange filing yesterday.

This took his direct stake from 330,000 shares or 0.015 per cent, to 230,000 shares or 0.01 per cent.

Recently, investor interest in Cosco has been thriving, with new issues of covered warrants on the stock.

However, with its share price surging around 70 per cent since June, profit-taking was on the cards, said market watchers, and the disposal of shares on the open market this week is not surprising.

Still, long-term sentiment on the stock appears bullish, with the likes of leading investment bank Merrill Lynch reinstating coverage on the stock this month.

The bank says Cosco is one of the fastest-growing blue chips under its coverage, expecting further upside due to robust global economic growth and increasing trade activity.

'Over the past two years, flawless execution has resulted in the group becoming one of the premier shipyards in China,' it said.

'A progressive expansion strategy already under way will help ensure Cosco becomes the dominant shipyard operator in China,' Merrill said.

It has put a 'buy' recommendation on the stock with a 12-month target share price of $2.34.

The counter closed three cents higher at $2.04 yesterday.