Reuters: Hot Stocks: STOCKS NEWS SINGAPORE-Sheng Siong rises as brokers up target price

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STOCKS NEWS SINGAPORE-Sheng Siong rises as brokers up target price Oct 25th 2012, 01:32 Wed Oct 24, 2012 9:32pm EDT Sheng Siong Group Ltd rose as much as 2 percent after it posted stronger-than-expected quarterly earnings, prompting several brokerages to raise their target prices for the supermarket chain operator. By 0115 GMT, Sheng Siong shares were up 1 percent at S$0.48, with nearly 4 million shares traded, 3.5 times its average daily volume over the last five sessions. Sheng Siong said its net profit for the third quarter rose 48.1 percent to S$9.8 million from a year earlier, helped by higher same-store sales and new store openings. CIMB Research raised its target price for Sheng Siong to S$0.58 from S$0.49, and kept its 'outperform' rating, citing new store openings and strong execution by the management. Sheng Siong is expected to open two new stores in the next quarter, CIMB said, noting that most of Sheng Siong's new stores should deliver strong earnings in 2013. However, CIMB said gross margins are expected to fall in the fourth quarter due to likely discounting on goods during the festive period. DMG & Partners also raised its target price for Sheng Siong to S$0.53 from S$0.51, and kept its 'buy' rating, citing the company's faster rate of expansion. (Reporting by Charmian Kok in Singapore; Editing by Anand Basu; charmian.kok@thomsonreuters.com) Link this Share this Digg this Email Reprints

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