SINGAPORE (Nov 19): Singapore rig builder SembCorp Marine could have just suffered “the first salvo in a possible wave of cancellations” after announcing that a contract had been called off by a customer, UOB Kay Hian says in a note.

The brokerage calculates that the cancellation of this latest contract will reduce SembCorp's book value per share by $0.04, “with another $0.08 on the cards if Oro Negro and Perisai follow suit,” referring to other contracts held by the firm.

UOBKH downgrades SembCorp Marine to sell, with a target price of $1.72.

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