Kenanga Research said the oil and gas offshore support vessel provider will see its daily charter rates trend upwards in the local offshore service vessels market.
PETALING JAYA: Things are looking up for Keyfield International Bhd
as it recently secured two new vessel charters.
The deals are for an anchor handling tug supply vessel (AHTS) and one accommodation work boat (AWB) for a cumulative value of RM59.6mil.
The first contract was awarded to its wholly owned unit, Keyfield Offshore Sdn Bhd (KOSB), by an offshore marine service provider in the United Arab Emirates (UAE).
The second contract was also awarded to KOSB by a commercial diving and remotely-operated vehicle service provider in Malaysia.
Kenanga Research said the daily charter rates will most likely be at least RM150,000 for the AWB and RM40,000 for the AHTS.
The AHTS charter will commence in April for a firm 720-day period with an option to extend for 180 days, serving in the UAE, while the AWB charter to be deployed in Malaysia will begin this month and run for 150 days with a 120-day extension option.
The research house said the oil and gas offshore support vessel provider will see its daily charter rates trend upwards in the local offshore service vessels (OSV) market, particularly as supply remains tight while client demand continues to increase.
The research house said the win for the company aligned with its forecasts, as it had factored in charters for the vessel types within Keyfield’s fleet projections.
In addition to the new charters, Kenanga Research said Keyfield had also taken delivery of a 152-person accommodation work barge, Keyfield Itqan, last July, which is being prepared for deployment.
“A second hand AHTS vessel, Keyfield Aulia, was also added to the company’s fleet on Aug 13, 2024. These vessels were expected to start contributing from the fourth quarter of 2024 onwards, further driving earnings growth,” the research house said.
Kenanga Research said it likes Keyfield for its exposure in the OSV industry, as well as its relatively young avearage fleet age of eight years and modern vessels which are preferred by clients.
“Furthermore, its inclusion as a panel contractor for AHTS vessels for Petroliam Nasional Bhd could open more doors for more third party AHTS charters,” it said, adding that it would maintain its “outperform” call and earnings forecast for the company with a target price of RM3.18.
Kenanga Research said risks to be expected include significant decline in oil prices, unexpected vessel downtime due to unplanned maintenance, and decline in the capital expenditure of oil producers.
Keyfield’s shares closed at RM2.27 yesterday.
