JF Apex Research ups Bumi Armada FV to RM4.27

KUALA LUMPUR: JF Apex Research has raised the fair value of Bumi Armada from the last traded price of RM3.98 to RM4.27.
It
rolled over its valuation to FY14 earnings per share (EPS) forecast of
19.6 sen and higher industry forward price-to-earnings ratio (PER) of
21.8 times.
“This translates into a fair value of RM4.27 and potential upside of 7.5%,” it said on Wednesday.
JF
Apex Research said it likes the company for its earnings visibility and
modern fleet that positions itself trategically to benefit from the
ongoing capex investment in the oil and gas industry.
It said
Bumi Armada's Q1, 2013 net profit met its expectations after rising 22%
on-year to RM110.4mil while revenue grew 46% on-year to RM488.8mil.
The
first quarter net profit and revenue made up 23.5% and 22.3% of its
FY13 forecast respectively. The improvement was due to higher
contributions from all three main divisions namely floating production,
storage and offloading (FPSO), offshore vessel support (OSV) and
transport and installation (T&I).
“We expect future earnings
to pick up following new contracts being executed including profit
contribution from by its 50%-owned subsidiary which is handling the
RM2.3bil Cluster 7 contract at offshore Mumbai.
“Orderbook remains steady at RM7.9bil with another RM4.3bil of potential extension,” it said.