Strong start of the year for MISC

MIDF REsearch says it maintains its “neutral” call on MISC with a target price of RM7.77.

PETALING JAYA: The addition of two new-generation liquefied natural gas (LNG) carriers, Seri Damai and Seri Daya, to MISC Bhd’s fleet of LNG carriers is a strong start for 2023.

More importantly, MIDF Research said it also represented a step forward in supporting a net-zero future for the LNG industry.

On Tuesday, MISC announced that it had delivered the two LNG vessels to Exxonmobil’s subsidiary, SeaRiver Maritime.

The green and energy-efficient vessels were built by Samsung Heavy Industries (SHI) and would be handled by Eaglestar Shipmanagement.

MIDF said the development is “a key milestone in its collaboration with SeaRiver Maritime, as well as its continuous partnerships with SHI, Eaglestar and its own gas assets and solutions team”.

“We opine that given MISC’s track record with LNG carriers’ long-term charters, as well as the strong demand in LNG globally, MISC is set to continue its robust performance,” said the research firm, adding that it sees positive future prospects in the oil and gas shipping sub-industry.

According to MIDF, the Seri Damai and Seri Daya will now add on to MISC’s fleet strength, which currently consists of 31 LNG carriers for its gas business.

In addition it has six very-large ethane carriers and two LNG floating storage units.

However, it said “the additional vessels have been factored in and considering their long-term operations, we make no changes to our earnings estimates at this juncture.

“Overall, we continue to like MISC as its medium to long-term growth plans stay intact, in line with the demand growth for LNG post-pandemic and the heightened tension in the Russia-Ukraine front,” said MIDF Research in a report.

The research firm said it maintains its “neutral” call on MISC with a target price (TP) of RM7.77. The TP is pegged on a price-earnings ratio of 21 times to a 2023 earnings per share of 37 sen.

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MISC , LNG , vessels , fleet , outlook


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