Malaysia-based portfolio manager Affin Hwang Capital Research foresees better financial performance from offshore service provider Alam Maritim in the second half of 2015.
In June, Malaysia-listed Alam Maritim clinched a USD13.1 million contract from Petronas FLNG 1 and a USD5.9 million contract from oil and gas company Chevron Malaysia.
According to Affin Hwang’s report , both contracts have increased Alam Maritim’s offshore installation and construction (OIC) order backlog to MYR250 million (USD65.6 million).
“We understand that Petronas’ FLNG1 transportation and installation works are divided into six packages. Alam Maritim has secured package 1 (MYR49 million) and are actively bidding for the others,” said Affin Hwang on Alam Maritim’s bids for MYR150 million worth of OIC works for the Petronas FLNG1 project.
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Affin Hwang believes that Alam Maritim’s performance in the second half 2015 will be driven by higher OIC work flows and higher usage of offshore support vessels (OSV).
The improved workflows in OSV should help lift Alam Maritim’s OSV business segment. Its earnings contribution from OSV segment fell 48.4% year on year in the first quarter because of lower vessel utilisation.
Thus, Affin Hwang has recommended ‘buy’ for Alam Maritim stocks at target price of MYR0.72 per share. The company’s stocks are currently traded at around MYR0.50 per share.
This post was sourced from IHS Maritime 360: View the original article here.