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Flour Mills Heads for Biggest Drop in 21 Months on Stanbic Cut

Sept. 1 (Bloomberg) -- Flour Mills of Nigeria Plc, which processes grains and sells cement, headed for the biggest drop in 21 months after Stanbic IBTC Bank Plc cut its price estimate.

The stock lost the limit of 5 percent, heading for its biggest decline on a closing basis since December 2009, to 76 naira by 12:33 p.m. in Lagos, the commercial capital.

Flour Mills’ price estimate was reduced to 131 naira a share from 167.50 naira by Lagos-based Stanbic IBTC.

Estimated earnings for fiscal 2012 are “expected to be weak as input costs remain high on tight global commodity supply and as its cement import business contracts sharply on government restrictions on cement importation,” Bunmi Njugo and Tajudeen Ibrahim, Lagos-based analysts with the lender, wrote in an e-mailed report to clients today, maintaining their “buy” rating on the stock.

To contact the reporter on this story: Vincent Nana in Lagos at vnwanma@bloomberg.net.

To contact the editor responsible for this story: Antony Sguazzin in Johannesburg at asguazzin@bloomberg.net.

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