ECM Libra Cuts Alam Maritim To Hold from Buy

 ECM Libra Investment Research cuts Alam Maritim Resources (5115.KU) to Hold from Buy following weaker-than-expected 9M11 results, which accounted for only 21% of house and 32% of consensus estimates. 

The house expects Alam "to turn into the black in 2H11 as charter demand has picked up across the industry. However, recovery has been slower than expected." 

It cuts its FY11/12/13 earnings forecasts by 60%/38%/35% citing slower demand growth and low utilization rates; "While earnings are recovering, we believe that recovery will still be slower than expected. 

As such, we are taking a more conservative stance on earnings for FY11 and also subsequent years." ECM lowers its price target to MYR0.77 from MYR1.11. 

It tips more contracts for its 1MAS300 pipe lay barge and secured long-term boat charters as re-rating catalysts. Shares are 0.7% higher at MYR0.755.