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3 Shares that Lost to the Market

The Straits Times Index (SGX: ^STI) gained 0.15% to 3296 today but some of the index’s components weren’t so lucky. Let’s take a look at some of the losers within the index.

Thai Beverage (SGX: Y92) was the biggest casualty among the STI components today with its share price taking a 4.2% haircut to $0.57. Last Thursday, the Thai beer brewer announced that it has been removed from the Credit Watch of credit rating agency, Standard & Poor’s after it had downgraded Thai Bev’s long-term corporate credit rating from “BBB” to “BBB-” with a negative outlook. S&P “expect Thai Bev’s higher debt and lower cash flow adequacy to weaken its financial risk profile over the next 24 months”. The market’s not taking the news too well as shares of Thai Bev had fallen by more than 7% since the announcement by S&P.

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Elsewhere, Noble Group (SGX: N21) fell 1.8% to $1.13. Last month, the commodities trading company, with interests in palm oil, sugar, energy coal, iron ores etc, had issued US$400m worth of notes that are due on 2018 with interest rates of 3.625%. The notes are part of a US$3b Medium Term Note program. Noble had also set up a revolving loan facility worth US$1.55b with a number of different banks, which it will use for general corporate purposes and to refinance existing debt. The company’s last-reported financials showed it had US$5.65b of debt on its balance sheet, excluding the Medium Term Note program and revolving loan facility.

It does not seem to be a good day for palm-oil related companies as Golden Agri-Resources (SGX: E5H) also dropped – shares slipped 1.9% to $0.53. Last week, the second largest palm-oil plantation company in the world gave a presentation titled “Breaking Down the Barriers to Responsible Palm Oil” at a conference co-organised by Union of Concerned Scientists, Philadelphia Zoo and The Forest Trust (TFT). The presentation was on the company’s Forest Conservation Policy (FCP), developed in collaboration with TFT. Under the FCP, Golden Agri-Resources would ensure that it does not leave behind any deforestation footprints.

The company’s serious about sustainable palm-oil production and was granted membership into the Roundtable on Sustainable Palm Oil (RSPO) in 2011. RSPO is a non-profit “international multi stakeholder organisation and certification scheme for sustainable palm oil”. Fellow industry players, Wilmar International (SGX: F34) and Noble Group either has plantations that are certified by RSPO or are actively looking to increase the level of certification.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chong Ser Jing doesn’t own shares in any companies mentioned.