M & A Securities maintains Buy on SapuraKencana, fair value RM3.98

Business & Markets 2013
Written by theedgemalaysia.com
Thursday, 25 April 2013 08:29
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KUALA LUMPUR (April 25): M & A Securities has maintained its Buy
rating on SapuraKencana Petroleum Bhd with a fair value RM3.98 after
it was reported that the company was bidding for US$6 billion of new
contracts in countries mainly outside Southeast Asia as it seeks to
double its order book.
In a note Thursday, the research house said it remained positive on
SapuraKencana’s ability to grow its orderbook further which currently
stood at RM18.0 billion (35% - Malaysia, 65% - Overseas) by securing
more new contracts outside Malaysia in line with the recent shareholder
approval for its US$2.9 billion purchase of the tender-rig operations of
Seadrill Ltd.
“We expect more tender rigs projects from SapuraKencana going
forward.
“We maintain our Buy call and fair value for SapuraKencana at RM3.98
by pegging its EPSFY14F of 19.9 sen to a P/E multiple of 20x.
The company’s chief executive officer Datuk Seri Shahril Shamsuddin
was cited in an interview in Singapore as saying that the
SapuraKencana, with existing orders of USD6 billion, sees growth in
South America, East and West Africa, and India.