Company Name: IEV HOLDINGS LIMITED
| Research House: UOB KayHian | Price Call: HOLD | Target Price: 0.54 |
Capital-raising may be on the cards for IEV Holdings (5TN.SG) after it terminated an agreement for Altfield Global Resources to invest in wholly-owned unit IEV Energy Investments, UOB KayHian says; “we believe the group will need to raise US$10 million-US$15 million ($12.2 million - $18.3 million) to develop its upstream business.
As IEV is currently in a net cash position, the capital requirements could be funded by a combination of debt and equity.” It notes IEV’s 49%-owned associate IEV (Malaysia) received a Letter of Award for a major transportation and installation project by an established O&G operator for a Southeast Asian deepwater facility.
UOB-KH estimates the contract value at MYR400 million-MYR500 million ($159.5 million - $199 million), adding that its earnings forecasts already factor in the project’s profit contribution. UOB-KH trims its target to $0.54 from $0.55 on a lower market value for associate CNG Vietnam (CNG.VH); it keeps a Hold call. On a technical basis, it notes the stock has twice rebounded from its $0.435 support level and tips it could test its next resistance at $0.62 if it breaks over $0.54. The stock is up 7.3% at $0.515.
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