Stock Name: ALAM
Company Name: ALAM MARITIM RESOURCES BHD
Research House: OSK

KUALA LUMPUR: OSK Research is maintaining its Neutral view on Alam Maritim as it is unsure of the latter's next course of action following the recent rejection of a debt revamp by Vastalux.

Vastalux has proposed that 20% of the amount it owes to its creditors to be settled through the issuance of 117.5 million new shares in Vastalux, 50% to be settled through the issuance of 293.6 million redeemable cumulative unsecured loan stocks (RCULS) and the remaining 30% to be waived.

Alam Maritim (M) Sdn Bhd will emerge as a substantial shareholder in Vastalux if it fully converts its portion of the proposed RCULS.

OSK Research said Vastalux directors were currently consulting their advisers on the next course of action. We are not aware of any timeline fixed for the next course of action.

'As we are unsure of Alam's next course of action, we maintain our Neutral view on the stock for now. Also, there is not expected to be much excitement in offshore marine support vessel industry in the near term, probably not until the marginal oilfield contracts have been awarded out to the fabricators first,' it said.

The research house said it was also not too upbeat on the company's 4QFY10 results, we believe its share price should hover within this level in the immediate term until there are further developments in the company or the vessel market.

'Our target price for Alam remains unchanged at RM1.00 based on a PER of 10 times FY11 earnings. As for longer term investors, we still believe that there is value in the company and they should look towards its 2011 performance,' it said.