Singapore Hot Stocks-Jiutian soars to 7-wk high after share sale

SINGAPORE, May 23 (Reuters) - Singapore-listed Jiutian Chemical Group rose more than 16 percent to a seven-week high of S$0.18 with over 63 million shares traded after it raised funds through a private share placement.

The share sale was to fund a higher stake in a methanol production plant in China.

Dealers said investors were optimistic about the future of the China-based chemical firm after the S$37.2 million ($27.4 million) offering was taken up by a number of investors including DBS Vickers Securities (Singapore) and Chew Hua Seng, CEO of Raffles Education Corp .

"There will be dilution of its shares with the equity placement, but the future prospects of the company are attractive to institutional investors. Other retail investors are buying on that," a dealer said.

But CIMB analyst Jessie Lim kept her "underperform" rating and a price target of S$0.10 on Jiutian's stock, citing the stake increase as "pricey".

"We prefer to maintain our conservative assumptions at this juncture to account for execution risks and potential start-stop problems at the new plant," Lim said in a client note.

0255 GMT - Straits Times Index <.FTSTI> was up 0.27 percent.

($1=1.359 Singapore Dollar)

CAPITAMALL HITS 2-MTH LOW AFTER BONDS ISSUE

CapitaMall Trust , Singapore's largest real estate investment trust, fell as much as 8.8 percent to near two-month low of S$3.20 per unit after the REIT said it plans to issue convertible bonds to fund an acquisition.

Dealers said the bonds issue would dilute CapitaMall's (CMT) price per unit, which dropped to S$3.20 with over 8 million units traded.

Moody's on Thursday affirmed the REIT's A2 credit rating but changed the outlook to negative, citing the increase in debt ratio to 45 percent from 35 percent and other financial risks related to the acquisition.

UBS kept their investment rating for the trust at "buy" with a price target of S$4.56, saying in a client note that the acquisition was "attractive".

"The convertible bonds issue and low headline asset yield may cause some short term price weakness, however, we would use this as a buying opportunity," UBS analysts said, adding that they would revise forecasts once the convertible bonds issue price is set.

0211 GMT - Straits Times Index <.FTSTI> was up 0.27 percent.

(Reporting by Tan Wei Xin, editing by Ovais Subhani) ((weixin.tan@thomsonreuters.com; +65 6403 5667; Reuters Messaging: weixin.tan.reuters.com@reuters.net))