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11:31GMT 27March2009-SIG (LSE: SHI.L - news) falls as RBS (LSE: RBS.L - news) cuts to 'hold'
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Shares in insulation and roofing materials group SIG, fall 4.8
percent as Royal Bank of Scotland downgrades its rating to 'hold' from 'buy' and
slashes its target price to 114 pence, from 435 pence, saying downside risks
remain.
The company recently raised 325 million pounds by selling new shares.
'The group's equity raising, while dilutive in size and form, has reduced
financial risk,' says RBS in a note. It says a price-earnings valuation of 11.8
times based on 2010 profits 'looks broadly fair, but this is dependent on
further cost savings and downside earnings risks remain'.
It says attention will now switch from the balance sheet to weakness in the
group's construction markets.
Citigroup (NYSE: C - news) also lowers its target for SIG on Friday, to 120 pence, from 173,
keeping its 'hold' rating.
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