Nam Cheong’s sale of three vessels, two AHTS and one PSV, boosts its orderbook to MYR912 million ($366 million), DBS Vickers says.
The total price tag for the three vessels is largely in line with the house’s estimates at about US$12 million for each AHTS and about US$20 million for the PSV, it says, adding it won’t be changing its earnings forecasts as the sales are within its expectations for the year. It notes the PSV was sold to a new customer based in West Africa.
“The sale of the PSV marks the penetration of a new offshore oil & gas market for Nam Cheong, and expands its future geographical scope. These sale contracts also further strengthen Nam Cheong’s track record of being able to sell its built-to-stock vessels well ahead of completion.”
It expects Nam Cheong’s earnings to be stronger in 2H12 with more vessels to be delivered during this period. It keeps the stock at Buy with $0.24 target, expecting FY11-13 earnings CAGR of close to 30%. The stock is up 1.1% at $0.185 at 4:38 p.m.
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