Prestariang - Making Its Mark in O&G Training

THE BUZZ  
Prestariang  announced  yesterday  that  it  has  received  a  letter  of  approval  from  the Ministry of Finance to implement the Professional Skill Set for Oil & Gas (O&G) Industry Programme. Under this programme, the company will provide training and certification to 360  university  graduates,  diploma  and  certificate  holders  for  a  period  of  three  months, for a total contract sum of RM4.8m.  

OUR TAKE  
Details  on  the  programme. According to  the company’s press  release,  the  up-skilling and  re-skilling  programme  will  provide  training  to  O&G  participants  from  multiple engineering  disciplines  ranging  from  mechanical,  civil,  structural,  electrical  as  well  as marine.  These  participants  will  receive  globally  recognized  and  industry-endorsed certification  on  completion  of  the  programme.  Prestariang,  which  owns  the  intellectual property for the programme, will be responsible in the provision of courseware, training, examinations as well as job placement for the eventual graduates.  

Significant breakthrough into O&G industry. Although the contract sum of RM4.8m is relatively  insignificant  vis-à-vis  the company’s existing  orderbook  of  over  RM100m,  we see  this  latest  development  as  a  positive  since  this  endeavour  will  mark Prestariang’s breakthrough  into  the  lucrative  O&G  training  market.  Under  the  country’s National  Key Economic  Areas  (NKEA),  the  O&G  sector  is  targeted  to  raise  its  contribution  to  Gross
National  Income  to  RM241bn  by  2020,  with  a  target  annual  growth  of  5%.  To  achieve this,  the  industry  will  need  52k  more  skilled  workers,  of  whom  at  least  40%  would  be professionals in the fields of engineering and geology.  

Riding on Government’s aim to nurture  O&G  sector.  This  contract  indicates  that Prestariang  has  successfully  replicated  its  IT  training  and  certification  business  in  the O&G  sector.  As  the  Government  continues  its  push  to  propel  the  development  of  the country’s O&G  industry  through  a  slew  of  initiatives,  this  latest  endeavour  opens  up  a not-to-be-missed opportunity for Prestariang to expand its presence in O&G training and certification by enhancing the skills of the O&G workforce.  

BUY.  We are pleasantly surprised with the company’s maiden venture into O&G-related training. We also  believe  this will  mark  the  beginning  of  a  slew  of  O&G-related  training and certification contracts as Prestariang strives to expand its presence in this booming sector  by  leveraging  on  the  Government’s  ultimate  ambition  to  fast-track  the development  of  the  O&G  industry,  as  well  as  transform  the country  into  a  high-income nation. Maintain BUY, with our FV unchanged at RM2.15, based on a 10x FY13 PER.

Source: OSK