PETALING JAYA : While average daily charter rates are expected to soften further in the second half of this year (2H25), analysts remain optimistic that Velesto Energy Bhd
’s rig utilisation will rebound to between 70% and 80%, supported by stronger contract visibility with work secured for five out of six rigs in 2H25.
Hong Leong Investment Bank Research (HLIB Research) said specifically, Naga 2, Naga 4 and Naga 6 are contracted with PETRONAS Carigali Sdn Bhd (PCSB).
“Naga 5 has secured employment with PTTEP Thailand from 3Q25 through to 1H26, while Naga 8 had been mobilised to Indonesia in 2Q25 and has commenced operations in July under its contract with PC Ketapang for 2H25,” the research house said in a report.
That said, Naga 3, the only rig not working for the whole of this year, will only likely see new projects sometime in 2H26.
“We believe margins will also be supported by the ongoing effort to reduce overheads and operating expenditures going forward, with no further inspection downtime anticipated.”
HLIB Research noted that Velesto reported 2Q25 core net profit of RM19.5mil, bringing the 1H25 total to RM71.5mil, down 34% year-on-year.
“We deem the results broadly in line with expectations, at 42% of our full-year forecast versus consensus at 48%. Core net profit was down 62% sequentially, in tandem with 11% lower revenue, primarily attributable to the completion of a project and a lower rig utilisation rate of 57% (versus 67% in 1Q25) as both Naga 3 and Naga 5 were idle, the research house noted.
HLIB Research maintained its “buy” call with a higher target price of 22 sen.
