CS Cuts SembMarine to Underperform; S$0.95 Target

Credit Suisse downgrades SembMarine to Underperform from Neutral on worries over major customer Petromena; cuts target to S$0.95 from S$2.15. Broker says Petromena facing US$300 million funding gap on its three rigs under construction at SembMarine’s Jurong yard; “if Petromena cannot raise an incremental US$100 million to take delivery of Petrorig 1 by 30 April, it would trigger a default.” Broker estimates Petromena and its related company LOG Rig jointly owe more than US$1.2 billion to SembMarine, which represents 20% of net order book; “until Petromena’s workout is successfully completed” it may overshadow SembMarine shares, which now +1.8% at S$1.69.