Perdana Petroleum last Friday announced on Bursa Malaysia that its wholly-ownedsubsidiaries, Intra Oil Services and Perdana Marine Offshore Pte Ltd, have beenawarded two contracts worth a total of approximately RM70.0m (excluding the extension options).
Contracts worth RM70.0m in total. The contracts are i) the provision of a workboat to Alam Maritim (AMRB MK, BUY FV RM1.25) for nine months commencing 4 Jan 2013, with an extension option for one year, ii) the provision of a workbarge to Ibnusina Resources SB for 21 months commencing 15 Feb 2013, with an extension option of three months.
Alam Maritim switches to Perdana Petroleum’s workboat. Alam Maritim had on 11 Oct 2012 announced that it had accepted the award from a local oil & gas company for the provision of one unit of workboat for a year with an extension option for another year, and it had acted as a broker for the deal. We gather from Alam’s management that it chose to charter Perdana Petroleum’s workboat instead and terminated the charter from the previous third party due to the more favourable charter rate offered by Perdana Petroleum.
Positive news but no changes to our earnings forecast. This is because we had earlier factored in some orderbook replenishment for its vessels.
Downgrade to NEUTRAL. As we make no changes to our FY13 forecasts, our fair value remains unchanged at RM1.17, pegged to 12x FY13 EPS. Nonetheless, we downgrade the stock to NEUTRAL from BUY given the limited upside to our fair value. Key re-rating catalysts for the stock include i) Dayang (DEHB MK, BUY FV RM2.90) increasing its stake in the company, and ii) improving charter rates (above USD2.0 per bhp) for its vessels.
Source: OSK
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