Journey to Wealth
Alam Maritim - Secures charter for 1MAS-300 Buy
- We maintain BUY on Alam Maritim Resources, with an unchanged fair value of RM0.85/share, pegged to an FY12F PE of 12x ' at a 25% discount to the oil & gas sector's 16x. We maintain our FY12F-FY14F earnings as its latest charter is within our expectations.
- Alam's 50%-owned Alam Swiber DLB (L) Inc has secured a charter for its pipe-lay barge 1MAS-300 from Newcruz Offshore Marine Pte Ltd with an RM18mil contract for a firm period of 175 days, commencing by the third week of October 2012.
- This contract is within expectations, which forms part of the additional RM200mil fresh offshore installation contracts targeted by the group this year. Together with new offshore contracts worth RM173mil secured since the beginning of the year, this new charter should raise the utilisation of 1MAS-300, and turn around the underwater and offshore installation division, which suffered a loss of RM4mil in 1HFY12.
- Recall that in January this year, Alam had secured an offshore construction contract worth RM115mil with Samsung Engineering Malaysia Sdn Bhd to transport, install and pre-commission two pipelines, two single point moorings and two pipeline end manifold for the Sabah Oil & Gas Terminal.
- Additionally in August this year, the group had secured another construction job worth RM58mil from a local oil & gas company to provide 18' diameter pipeline installation work for SKO PL364 pipeline replacement project over a two-month period in August and September 2012.
- The constant flow of new contracts supports our positive view of the group, which has secured RM507mil orders since the beginning of the year. These comprise RM209mil charter contracts for vessels and RM298mil offshore construction jobs such as transportation and installation of pipelines.
- These new jobs led to the group buying Crest Station 3, a 100 metre-Accommodation Work Barge, which has a capacity of 402 crew members, from Pacific Crest Pte Ltd in June this year for RM95mil to service the 18-month charter contract (excluding a 1-year extension option) fromExxonMobil Exploration and Production Malaysia Inc.
- Given the rising need for offshore installation work, we also expect Alam to be awarded additional charters for its idling and spot-chartered vessels as global utilisation has tightened. We note that day rates have been slowly rising on tightening global vessel utilisation.
- As such, we maintain our view that the company's earnings recovery is intact with an undemanding valuation of FY13F PE of 8x ' above the oil & gas sector's 16x.
Source: AmeSecurities
Related Stocks
| Chart | Stock Name | Last | Change | Volume |
|---|
More articles on Journey to Wealth
Ekovest: No plan to launch another offer for Iskandar Waterfront City
Created by kiasutrader | Mar 29, 2018
Kenanga Research - On our Portfolio - Parliament dissolution around the corner?
Created by kiasutrader | Mar 25, 2013
Plantation Sector - Proposed accounting standard scrapped OVERWEIGHT
Created by kiasutrader | Mar 25, 2013
Pavilion Reit - Limited upside, earnings upside have been priced in HOLD
Created by kiasutrader | Mar 25, 2013
Discussions
Be the first to like this. Showing 0 of 0 comments
Post a Comment
Featured Posts
Introducing MY's First IPO Fund for Sophisticated Investors!
New Update. Discover investment communities that resonate with your ideas
M & A Value Partners IPO Equity Fund has been launched - Targeted 13% Return p.a
Latest Videos
Apps
Top Articles
2
3
BFM Podcast
4
5
BFM Podcast
6
Koon Yew Yin's Blog
CPO price is rising rapidly as shown by chart below - Koon Yew Yin
7
Axcapital's investment blog
KAB - Executing its way to a record quarter. Could more Petronas contracts be coming?
8
Mercury Securities Research
#
Stock
Score
Daily Stocks
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
Featured Advertisers / Partners
Ride The Bull Short The Bear
CS Tan
4.9 / 5.0
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
