Thursday, May 15, 2014

Affin Daily Insight (LV) - 15 May 2014 - AMRB / KLK / DMR


Top Calls

Company Update Alam Maritim (BUY, maintain)

- Subsea and OIC business gaining momentum

Alam plans to acquire a diving support vessel (DSV) under a JV agreement with an existing asset owner. Alam will only need a capital outlay of RM40m to fund the purchase of US$80m DSV. The chartering cost of a DSV (currently in the range of US$80,000-120,000/day) typically accounts for up to 75% of the subsea IRM operating cost. The proposed acquisition is a timely expansion to secure a bigger pie of the upcoming RM2bn domestic subsea IRM contracts. We raised our 2015-16E net profit forecast by 18-19% and EPS forecast by 2-3% after factoring in higher charter income from the new DSV, higher OIC & subsea earnings, lower net interest expenses, and 15% dilution impact from the issuance of new shares. We rolled forward our valuation basis to 2015 and raised our TP to RM2.10 (from RM1.83) based on an unchanged 14x forward PER. Maintain BUY.


Other Calls


Debt Market Research

- Bargain hunting flattening, boosted volume and good



For important disclosures, please refer to the Disclosure section at the end of the individual linked research reports.

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