Hibiscus North Sabah asset offers growth prospects, says PublicInvest

KUALA LUMPUR: PublicInvest Research said it is excited over Hibiscus Petroleum Bhd's growth prospects as the acquisition of the North Sabah asset was completed in March.

"The asset is expected to add another 6,000bbls/day production to existing production of 3,500bbls/day from Anasuria, putting it on track to achieve its target of 20,000bbls/day in next few years. 

"Furthermore, North Sabah provides opportunities to increase the production rate from its 40.9mbbls of 2P oil reserves and 79mbbls of 2C resources (based on 100% interest as of 1st Jan 2018 gross estimate)."

The research house noted that Hibiscus's 9MFY18 net profit of RM105mil came in within expectations aided by a negative goodwill of RM112.4mil arising from the completion of the acquisition. 

The net profit of RM83.1mil in 3QFY17 was a huge jump from RM6.5mil in the previous corresponding quarter due to the negative goodwill as well as lower OPEX/boe of US23.96mil versus US$34.44 in the immediate preceding quarter from the Anasuria asset.

PublicInvest research maintained its outperform rating on the stock with an unchanged target price of RM1.08.