Keppel Corporation Limited Leads The Market Down This Week

For the week that started on 11 January 2016, Singapore’s market bellwether, the Straits Times Index  (SGX: ^STI), slumped 4.4% to end Friday at 2,631 points.

Of the 30 index components, 23 ended the week with losses while five had eked out some gains. Capitaland Mall Trust (SGX: C38U) and Thai Beverage Public Company Limited (SGX: Y92) were the two blue chips that ended the week unchanged.

The biggest loser in the index was the oil & gas, property, and infrastructure conglomerate, Keppel Corporation Limited (SGX: BN4), which dropped like a hot potato by around 17% to S$4.84.

During the week, the price of oil had hit a 12-year low, falling below US$30 per barrel. Keppel Corp owns one of the world’s largest offshore and marine outfits. Its competitor, Sembcorp Marine Ltd (SGX: S51), was not spared from the market-carnage either. Sembcorp Marine’s shares slumped 15% to S$1.385, making it the second biggest weekly loser in the Straits Times Index.

Currently, Keppel Corp and Sembcorp Marine are valued at 4.8 times and 6.9 times trailing earnings, respectively.

Keppel Corp, amid falling oil prices, announced two pieces of news this week. The first revealed that the company has handed over the Bialystok waste-to-energy combined heat and power project in Poland to its client on the last day of 2015. The plant can process around 120,000 tonnes of waste a year.

The other news stated that Keppel Corp had substantially handed over the Doha North Sewage Treatment Works to its client on 10 December 2015.  The “facility has the capacity to treat up to an average flow of 245,000m3 of wastewater per day and will be the largest greenfield wastewater treatment, water reuse and sludge treatment facility in Qatar.”

Sats Ltd  (SGX: S58), which is largely involved in the airline industry, providing gateway and food solutions, put on the best performance in the index for the week. Its shares grew by 2.1% to S$3.88. During the week, it had bought back 507,000 of its own shares, valued at around S$1.9 million. Its market capitalisation currently stands at S$4.3 billion.

Outside the index, budget carrier Tiger Airways Holdings Limited (SGX: J7X) revealed that as of 11 January 2015, 79.7% of its shares are now controlled by Singapore Airlines Ltd (SGX: C6L) and its concert parties. Last week, SIA upped its privatisation offer for the budget carrier from S$0.41 per share to S$0.45. Shareholders of Tiger have until 5 February 2016 to tender their shares. SIA saw its shares inch up by 0.3% to S$11.04 during the week while Tiger’s climbed by 2.2% to S$0.46.

The SPDR STI ETF (SGX: ES3), an exchange-traded fund which tracks the fundamentals of the Straits Times Index, is now valued at 10.8 times trailing earnings and has a dividend yield of 3.6%.

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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 Sudhan P doesn’t own shares in any companies mentioned.