First Resources (EB5.SG) falls 8.1% to $1.48 after major shareholder Eight Capital sells 75 million ordinary shares and Citigroup places 15 million treasury shares held by the company at $1.48 each. 

Eight Capital says the placement is to improve the stock’s free float, and that it remains committed to First as a substantial shareholder. An analyst at a local brokerage says “it’s quite expected that the market will react negatively. The price has come down quite significantly, so I think it probably presents a buying opportunity for investors. Even at yesterday’s close of $1.61, it was trading at 13X our earnings estimates, now its even lower so it does look interesting for those who haven’t got exposure to the sector.” 

 

The analyst notes the stock’s recent gains are in tandem with rising CPO prices; “our house view is that (CPO) prices will hold up over the next couple of quarters...as an upstream player, that should reflect well on its earnings.” 

 

Orderbook suggests $1.47 likely floor today.