South China's hopes of regaining the BMA First Division title suffered another setback last night when they lost to TSW Pegasus 2-1 at Yuen Long Stadium. Goals from Leandro Silva and Manoel Filho (penalty) condemned the Caroliners to their second loss in six games. South China opened the scoring through Li Haiqiang, but the ex-champions were unable to add to the tally even after Pegasus' Karl Dodd was sent off in the 67th minute. South China are now four points adrift of champions Kitchee, who regained top spot in the table despite being held to a goalless draw by Citizen at Mong Kok Stadium. Hong Kong international Lam Ka-wai made his first appearance of the season after recovering from a thigh injury to strengthen Kitchee's midfield. But the second half substitute was unable to make an impression in an evenly contested match.