Earnings rebound seen for Robert Kuok’s Maybulk

Earnings rebound seen for Robert Kuok’s Maybulk
Business & Markets 2013
Written by Chong Jin Hun of theedgemalaysia.com
Thursday, 25 July 2013 11:26

KUALA LUMPUR (July 25): MALAYSIAN BULK CARRIERS BHD [], controlled by tycoon Robert Kuok, is expected to report higher profit in the near term in anticipation of an increase in dry bulk shipping charter rates, analysts said.

In a note today, HwangDBS Investment Bank Bhd analyst Goh Yin Foo said charter rates could have bottomed, hence, the research firm expects Maybulk’s net profit to rise 51% and 53% year-on-year in financial years (FY) ending December 31, 2014 and 2015 respectively.

Goh said this is "on the assumption that the shipping charter rates recovery would persist".

HwangDBS foresees an annual rise in average charter rates of 5% and 10% in 2014 and 2015 respectively.

“On the assumption that the shipping charter rates recovery would persist, our research team anticipates Maybulk’s earnings to jump from a trough of RM49 million in FY13 going forward,” Goh said.

He said HwangDBS' existing fundamental rating for Maybulk is a "buy" with a target price of RM2.10. At 11.23am, Maybulk shares rose five sen or 3% to RM1.85.

"An added catalyst in this financially-strong group (net cash of RM96.5 million or 9.6 sen per share as of end-March 13) is its plan to unlock value by listing its 21%-owned PACC Offshore Services Holdings (a provider of offshore marine support services in the oil & gas industry) in Singapore by end of this year or early next year," Goh said.