The Daily Pulse of Bursa Malaysia

Perdana Petroleum trades on new highs as it rides on come new jobs.

zaclim
Publish date: Tue, 21 May 2024, 08:14 AM
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Perdana Petroleum Bhd has been on a great run, up 123.5% in the past year to close at 38 sen on May 20.

At 38 sen, the counter has now reached its 52-week high versus a low of 15 sen.

Perdana managed to breach its market structure to move to a new high and trading above its uptrend line.

The immediate resistance level is 39.5 sen followed by 45.5 sen.

Moving forward, the stock is expected to continue its uptrend trend with support pegged at 31.5 sen.

In March, Perdana announced that its wholly-owned subsidiary Perdana Nautika Sdn Bhd has accepted letters of award from Dayang Enterprise Sdn Bhd to charter one unit of anchor handling tug and supply (AHTS) vessel and one unit of accommodation work barge (AWB) worth RM13.4 million.

The estimated value of these charters is RM4 million for the AHTS vessel and RM9.4 million for the AWB unit.

It said the vessel's charter is part of a strategic alliance with Dayang Group, aiming to maximise vessel utilisation and qualify for more offshore maintenance works.

Perdana Petroleum said the contract is expected to contribute positively to the earnings and net assets of the group for the financial year ending Dec 31, 2024.

But Dayang is a major shareholder in Perdana Nautika, with a 64% stake, which makes it a related party transaction, something investors would take note of.

However, RHB Research is positive of Dayang’s 64%-owned Perdana Petroleum Bhd’s contract wins.

It believes Perdana Petroleum marine segment is likely to deliver stable earnings growth, backed by better utilisation and higher daily vessel charter rates.

The research house continues to favour Dayang, which is a key beneficiary of an increase in upstream maintenance activities and robust offshore service vessel demand, while it remains relevant in the new contract life cycle.

RHB was positive on Perdana’s contract awards as they ensure earnings visibility for the coming quarters.

It was guided that the implied daily charter rates of RM33,000 to RM72,000 point to a mild improvement from that of previous contracts due to tight vessel supply.

Perdana’s net profit jumped nearly four-fold to RM44.42 million from RM11.39 million a year earlier on improved charter and flat utilisation rates.

These factors also boosted the offshore support vessel (OSV) operator’s revenue by 59.65% to RM313.91 million versus RM196.63 million previously.

Investors will not go wrong banking on Perdana on the back of heightened oil & gas activities and its undemanding valuations could serve as a magnet for potential new shareholders.

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