KUALA LUMPUR: Sapura Energy Bhd
's orderbook has jumped to RM17.5bil following the award of multiple contracts with a combined value of about RM815mil.
The company had announced it had secured contracts in Malaysia, AUstralia, Brunei and Nigeria, bringing its total new contract value this year to RM5.3bil.
"These contract wins are undoubtedly positive to the Group as it
ensures the Group’s earnings visibility for the next three years, while also helping to further improve the utilization of its fabrication yard and drilling rigs," said PublicInvest Research.
The research house added that Sapura Energy's tender book remains strong, growing from US$2.5bil in FY17 to US$7.4bil with additional prospects of US$10.2bil this year.
However, PublicInvest Research kept its earnings unchanged as the contracts are already accounted for in its yearly replenishment assumption of RM6bil.
"We maintain our Trading Buy call with an unchanged TP of RM0.81. It is however be lowered to RM0.46 upon divestment of the 50% stake in its E&P business and issuance of rights and RCPS-i, and RM0.38 upon full exercise of both RCPS-i and warrants," it said.
PublicInvest added that Sapura Energy's results announcement this week have a high chance of a downside bias due to prolonged losses in its drilling segment, which it expects to take some time to recover despite improvement in activity.
"We maintain our forecasts nonetheless pending result release," it said.
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