UOB Kay Hian has downgraded its rating for Singapore Post (SingPost) from “buy” to “hold”, while lowering its target price from $2.25 to $1.64 respectively. In a Monday report, analysts Andrew Chow and Thai Wei Ying say they have revised their earnings estimates down by 11-18% for FY17-18, anticipating SingPost’s earnings to be reined in by integration headwinds and goodwill provisions from leadership changes. However, they do expect earnings to pick up in FY18. “We continue to view positively SPOST’s steps to improve corporate governance, and deem its transformation to an e-commerce and logistics outfit as necessary,” say Chow and Thai. According to UOB, the following are likely to bring about stock impact:

1. Integration of TradeGlobal

SingPost’s chairman Simon Israel has said it may take years before the company’s acquired business, TradeGlobal, contributes materially to its bottom line. Observing how SingPost recorded a net loss of $0.......