Stock Name: SembMar
Company Name: SEMBCORP MARINE LTD
Research House: DBS Vickers
It adds, “further, Capital Ship Management Corp. is reportedly evaluating options to build two 400-foot jackups with SMM’s PPL Shipyard.” The house says the next wave of rig orders could be led by semi-submersibles,
Company Name: SEMBCORP MARINE LTD
Research House: DBS Vickers
SembCorp Marine (S51.SG) extends gains, rising 4.2% to $5.71 in active trade after winning a $450 million harsh-environment jack-up rig order from Seadrill.
DBS Vickers says this brings SMM’s FY11 year-to-date order wins to $900 million, and outstanding order book to $5.4 billion, reversing its downtrend and lifting its book-to-bill ratio to 1.4X. “Momentum for order wins remains strong, with options on hand for 10 jackups worth US$2 billion ($2.53 billion).”
DBS Vickers says this brings SMM’s FY11 year-to-date order wins to $900 million, and outstanding order book to $5.4 billion, reversing its downtrend and lifting its book-to-bill ratio to 1.4X. “Momentum for order wins remains strong, with options on hand for 10 jackups worth US$2 billion ($2.53 billion).”
It adds, “further, Capital Ship Management Corp. is reportedly evaluating options to build two 400-foot jackups with SMM’s PPL Shipyard.” The house says the next wave of rig orders could be led by semi-submersibles,
“This follows the award of deepwater drilling permits in the U.S. Gulf of Mexico, post the Macondo disaster.” It notes, SMM is trading at mid cycle P/Es of 14X-15X with attractive final and special DPS of 31.0 cents, yielding 5.7%. The house keeps its Buy call and $6.63 target.
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