CIC opts out of SIIC after one year of investment

It has cleared all its 660m shares in SIIC.

Analysts believe that CIC is looking at profit-taking or portfolio restructuring as the reason behind its exit from SIIC Environment.

According to a report by Maybank Kim Eng, CIC has cleared all its 660m shares in SIIC at SGD0.149 apiece, by placing them out on 5 Dec. The selling price was at an 8% discount to SIIC’s 4 Dec closing price or 75% above CIC’s cost. This was unexpected and SIIC’s share price shed 14% since then.

Maybank Kim Eng still believes China’s water sector is where investors can plump for in FY15. Catalysts should include water-tariff revisions, further policy support and industry consolidation.

Operationally, SIIC continues to make progress. YTD, it has acquired 1.1m tonnes of water-treatment capacity. This slightly beats its 1m-tonne/year target.

From Maybank Kim Eng’s discussions with management, there remain sufficient projects in its due-diligence pipeline. Maybank KE believes there could be more acquisitions early next year. Some plants are also ready for expansion and upgrading.