“We think the resurgence of negative newsflow on any form of investigation by Brazilian authorities could weigh down Sembcorp Marine’s share price in the near term until further clarity is provided,” writes Lim in her March 24 note.
Lim Siew Khee of CGS-CIMB has maintained her “add” call and 12 cents target price on Sembcorp Marine, following news that Brazilian authorities have commenced a “preliminary administrative liability proceeding” against the company’s local unit, Estaleiro Jurong Aracruz Ltda (EJA), for alleged “irregularities”.
According to Sembcorp Marine, the notice gave no further details and SMM cannot assess the matter or its impact, if any. EJA is fully cooperating with the authorities.
