KUALA LUMPUR: RHB Research has maintained its Buy call on TAS Offshore with a target price of RM1.42 as it favoured the group for its growing demand for OSVs in the oil & gas sector, and coupled with a healthy orderbook.
In a note on Thursday, RHB said it had lowered TAS' FY15-16 net profit forecast by 5%-11% by assuming lower margins.
"We also revise down our target price to RM1.42, pegged to an unchanged FY15F P/E of 9.5 times. Note that this is still at a 35% discount from its four-year average P/E of 15 times, which implies a low three-year average PEG of 0.23 times," it said.
It added that TAS' 1QFY15 revenue came in at 24% of RHB's full-year target and bottomline was at 18% of its FY15 estimate.
Meanwhile, RHB said TAS has entered into joint-venture (JV) agreement with Chan Baihang in September to fund its BTS vessels.
"The company said the BTS model requires intensive investments in capital and that the JV would allow TAS to achieve this objective while minimising the exposure risks in this operation. Currently, TAS is building six more offshore support vessels (OSVs), which ought to be delivered by 2015," it said.
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