Thursday, March 3, 2011

Kim Eng raises Keppel target to $13.95; keeps Buy

Stock Name: Kep Corp
Company Name: KEPPEL CORPORATION LIMITED
Research House: Kim Eng

Kim Eng raises Keppel Corp. (BN4.SG) target price to $13.95 from $13.05 and keeps the stock at Buy. “After a full review, we are raising our forecasts for FY12 and FY13 to factor in the raft of new orders for the Offshore & Marine division over the past six weeks. We believe that order flows will continue to be strong, once the uncertainties in the Middle East have settled down.” 

The house notes a slight lull in orders since midFebruary, as rig buyers pause to assess the Mideast situation before committing to further orders; “however, we believe the underlying market for rigs remains strong. Such events also give individual countries a further impetus to develop their own offshore reserves rather than rely on Middle Eastern oil.”
Kim Eng raises its FY12-13 forecasts by 20% and 16% respectively and introduces Keppel’s 27.8% stake in Dyna-Mac (NO4.SG) to its SOTP model. 
Shares +2.3% at $11.76. 

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