Warrants Highlight

Will Ezion continue its rally?

Yesterday, the STI had a late afternoon rally and many counters ended in the green. However, Ezion Holdings, a provider of offshore marine logistics and support services, stood out amongst the gainers, adding 4.2% as compared to the previous day.

Macquarie’s Ezion warrants

+17% in less than a week
Yesterday, Ezion ended the day at its all time high of $1.240. Its share price has gained 19.2% since its first break out beyond a dollar on August 10. The STI paled in comparison, falling 1.2% for the same period.

Particularly, Ezion has made an increase of 17% in less than a week (compared to its close on September 5), when it made an announcement of a $125bn subordinated perpetual securities issuance. In an after market announcement on September 5, Ezion said that it will be issuing subordinated perpetual securities yielding 7.8% this Friday, 14 September. Proceeds from this issuance will be used for general corporate purposes.

Break out on results and contract win
Ezion first moved above the dollar mark again on August 10. Prior to that, the only time this year the stock traded above a dollar was in April.

The break out came on the back of the company’s results announcement which showed significant improvements compared to similar periods during FY2011. Profit for the second quarter was 130.4% higher than that compared to 2Q2011 and sales increased 41.2%. In addition, Ezion reported stronger year on year growth in regards to revenue and adjusted net income as compared to its peers.

On the same day their results were announced, Ezion’s board of directors also said that the company has secured a charter contract and a letter of intent to provide two additional Service Rigs to be used by multinational oil majors to support their oil and gas activities in the North Sea. The contract is worth approximately US$80 million over a 5 year period.

After the reports were released, Ezion has rallied since, with little retracements.

Establishes wholly-owned subsidiary
In other news, the company recently announced that it has established a wholly-owned subsidiary in Singapore, named “Alantic Esbjerg Pte Ltd”. The subsidiary, which has a paid-up capital of US$100,000 focuses on the provision of rig services as well as being a rig owner.

Singapore Market Wrap

Returning to a sideway market without catalysts

Another flat day across Asian markets as investors continued to "wait & see" and refrained from entering into the market. The FOMC meeting tonight and tomorrow may set the tone for trading the next few days. The STI hovered within a tight 15-point range yesterday before ending the day 0.3% higher at 3,016.40.

STI 3100MBeCW121031 (Q1AW) exercise level 3,100.*
STI 2950MBePW121031 (Q0ZW) exercise level 2,950.*

SGX - trading interest surge
More than 6mn shares changed hands in SGX (-0.6% dod, $6.92) yesterday, 10 times of its turnover on Monday and almost 5 times of its last week's daily average turnover. The stock crossed its psychological level of $7.00 in late August but failed to convincingly hold its gains.

Call warrant SGX MB eCW121203 (Q0LW) exercise price $7.50.*
Put warrant SGX MB ePW121204 (Q4TW) exercise price $ 6.60.*

Ezion rallying again
Offshore marine logistics and support services provider, Ezion, rallied 4.2% yesterday to $1.24, bringing its year-to-date gains to 87.9%. Its shares rallied 13.7% last week after announcing its plan to issue $125mn of 7.8% perpetual securities. The management said that the proceeds are expected to be used for general corporate purposes, including the financing of investments in offshore and marine assets and general working capital.

Call warrant Ezion MBeCW130301 (Q5SW) exercise price $1.20.*

Overnight Market Wrap

The S&P resumes its rally

Last night, the S&P added 0.3% dod after falling 0.6% on Monday. It closed at 1433.56 while waiting for the FOMC meeting to commence.

Today, the Federal Reserve committee will start their two day meeting amid speculations that they will be announcing a third round of quantitative easing, most likely through asset purchases.

It is also a big day for the Germans as the German Federal Constituency is due to rule on their participation in the 500Eur bailout fund. Yesterday, the German courts said that they will definitely announce their role in the fund without any delay. With that, the Eurostoxx 50 closed 1.2% higher compared to Monday.

Overnight Markets

Indices	Last	Change
STI	3016.40	0.3%
HSI	19857.90	0.1%
DJIA	13323.40	0.5%
S&P 500	1433.56	0.3%
Nasdaq	3104.53	0.0%
China A50	7271.69	-0.8%

Corporate News

Corporate Announcements

Ex-dividend dates:
Wed 26 Sep: SGX ($0.15)
Tue 6 Nov: Olam ($0.05)