China Shipping Container Lines (2866)

HONG KONG, Aug 1 (Reuters) - Shares in China Shipping Container Lines (CSCL) <2866.HK> tumbled 6.7 percent on Friday, falling to a 15 month low, after Lehman Brothers slashed its target price on the stock by nearly 28 percent on a gloomy industry outlook.

The stock dropped to HK$2.38, a level last seen in late-April 2007. Lehman Brothers cut its target price on the stock to HK$2.1 from HK$2.9 while maintaining its underweight rating on the stock.

China's second largest container operator extended Thursday's 4.5 percent drop after its peer Oriental Overseas (International) Ltd <0316.HK> reported weaker-than-expected earnings on Thursday and warned of more challenges in the second half owing to a demand slowdown and sky-high energy costs.[ID:nHKG134505]

"We expect freight rates to decline due to a continued slowdown in demand, and we think it is unlikely to improve in 2009," said Lehman analysts Andrew Lee and Ceclia Chan in a research note on Thursday.

The brokerage also said weakening Asia-Europe demand in recent times is likely to drive the CSCL stock lower.

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Neptunes Orient Lines ( NOL .Sin)

SINGAPORE, Aug 7 (Reuters) - Neptunes Orient Lines, the world's seventh-largest container shipping firm, plunged as much as 8.4 percent to hit a 19-month low after it warned business will be more difficult in the second half of the year.

NOL fell to S$2.52 with almost four million shares changing hands.

The shipping firm posted a 19 percent fall in net profit on Thursday due to tough conditions and higher costs, and said it faced a worsening shipping market and expensive fuel. [ID:nSP112524]

"Although its results are not that bad compared to other shipping lines, investors are reacting to the bleak outlook. Freight rates can't really sustain at this level, and will definitely not go higher," a dealer at a local broking house said.

"Moving ahead, NOL will face rising fuel and oil prices and over the long term, we need to look at how the management can hedge oil prices and manage costs," he added.

0125 GMT - Straits Times Index <.FTSTI> was down 0.6 percent.

COSCO FALLS ON PRESIDENT'S SHOCK EXIT

Ship building and repair firm Cosco Corp (Singapore) <COSC.SI> fell as much as 7.8 percent to hit a 17-month low on news of its president Ji Hai Sheng's shock exit.

Shares of Cosco fell to S$2.49 with more than four million shares changing hands.

"A new and sudden change in a key management role does not bode well in this weak investor climate," said DMG & Partners analyst Serene Lim. "The share price is likely to be pressured, at least in the near term."

Cosco announced on Wednesday that Ji, who was also the vice-chairman and executive director of Cosco, will be stepping down with effect from Thursday.

A report in the Straits Times said Ji was informed of the board's decision only on Wednesday.

He will be replaced by Jiang Lijun, the chief executive officer of Cosco Shipping since 2002.

0105 GMT - Straits Times Index <.FTSTI> was down 0.54 percent.

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Shanghai electric (2727.hk)

HONG KONG, Aug 1 (Reuters) - Shares in Shanghai Electric Group Co Ltd <2727.HK>, China's top power generation equipment maker, fell as much as 5.5 percent on Friday after Reuters reported that its margins will fall by as much as 3 percentage points as it grapples with rising steel prices.

But executives say they do not expect a fall in gross margins to show up on financial results until 2009, because most of the products to be delivered this year had been ordered two years ago.

Still, the company chalked up around 60 billion yuan ($9 billion) of new orders in the first half, hitting 95 percent of its full-year target, senior executives told Reuters on Thursday.

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