The Straits Times / The Business Times News on Cosco

Warrant watch: Cosco issues surge as firm secures new deals

THE recent strong performance of Cosco Corp (Singapore) has refocused investors' attention on offshore and marine stocks.

Yesterday, brokerage CIMB-GK was among those issuing an upbeat note on Cosco, after the company said last Friday that it had secured US$1.2 billion (S$1.8 billion) worth of contracts to build bulk carriers from related companies in the Cosco Group, as well as external ship owners.

Yesterday, Cosco shares surged 40 cents or 13.4 per cent to close at a record high of $3.38 on a volume of 37.9 million shares.

As a result, warrants issued on Cosco also nabbed a share of the action. One warrant issued by Macquarie with a strike price of $2.98, doubled, moving up 11.5 cents to 23 cent. About 8.5 million units were traded.

A Merrill Lynch warrant with a strike price of $3.33 rose 111.8 per cent to 18 cents. Around 12.4 million units were traded.

For those who may have missed the Cosco warrants boat, Macquarie Securities head of warrants Barnaby Matthews said there are some new Keppel Corp warrants in the pipeline 'to provide investors with some higher exercise prices as these stocks have been very strong lately'.

He added that there are also Labroy Marine and STX Pan Ocean covered warrants being launched as there is 'a lot of interest in the offshore and marine sector in recent times'.