PETALING JAYA: RHB Research is positive on Perdana Petroleum Bhd
’s latest contract wins as they will provide earnings visibility for the coming quarters.
The research house said the marine segment of Perdana Petroleum is also likely to deliver stable earnings growth, backed by better utilisation and higher daily vessel charter rates.
The company, which is 64%-owned by Dayang Enterprise Holdings Bhd, announced on Wednesday that it won five contract awards.
Four were contract extensions and the fifth a new deal for the supply of an anchor handling tug granted by PETRONAS Carigali. The value of these contracts range from RM8.3mil-RM19.8mil. The total duration of the contracts range from 140 days to 271 days, effective either from November 2023 or January this year.
“We are positive on these contract awards as they ensure earnings visibility for the coming quarters.
“The company’s management provided guidance that the implied daily charter rates of RM33,000 to RM72,000 point to a mild improvement from that of previous contracts,” RHB Research said in a report yesterday.
Perdana Petroleum is targeting 65%-70% utilisation with its orderbook standing at RM250mil as of December 2023.
Meanwhile, 14 out of Perdana Petroleum’s 15 vessels have secured contracts that last one to nine months.
As of Feb 22, 10 vessels are already on hire and 14 vessels will be on hire, effective mid-March.
“We continue to favour Dayang, which is a key beneficiary of an increase in upstream maintenance activities and robust offshore service vessel demand, even while it remains relevant in the new contract lifecycle,” said the research house.
However, RHB Research is making no change to its earnings estimates as it deem these contract wins to be within assumptions.
As such it keeping the target price at RM2.95, pegged to 16 times financial year 2024 price to earnings, and applying a 6% environmental, social and governance (ESG) discount based on Dayang’s ESG score of 2.7 out of 4. It also maintained the “buy” rating it had on Dayang.
