Maybank IB said it believes MISC would be unlikely to take on more than one project at a time to avoid stretching its balance sheet capacity and project management bandwidth.
PETALING JAYA: MISC Bhd
is in a good position to strengthen its floating production, storage and offloading (FPSO) business with expectations of an FPSO supercycle from 2026 to 2029, according to Maybank Investment Bank Research (Maybank IB).
Based on S&P Global’s statistics, the research house said global offshore capital expenditure is projected to rise steadily, reaching US$211bil by 2029 from about US$150bil in 2026.
This investment upcycle is expected to lead to an FPSO supercycle, in which MISC is looking to be a part of, in Maybank IB’s view.
S&P Global is also expecting eight, 12 and nine FPSO awards in 2026 to 2028, respectively, with large-scale projects focused on South America and the Asia-Pacific region.
Upstream Online has reported that MISC is either preparing or is already in the process of bidding for multiple FPSO projects globally, namely, Albacora FPSO for Petrobras, Sergipe-Alagoas Deepwater project alongside South Korea’s Hanwha Ocean, which could house two FPSOs for Petrobras, and FPSO Sepat for Petroliam Nasional Bhd or PETRONAS.
Upstream is an independent oil and gas industry upstream sector news site.
Maybank IB said it believes MISC would be unlikely to take on more than one project at a time to avoid stretching its balance sheet capacity and project management bandwidth.
But this signals that MISC is actively looking for growth in its offshore segment after Mero 3 successfully achieved first oil in October 2024, which it views positively.
The research house said it continues to like MISC for the defensive nature of its business models which provide recurring cash flows, and is maintaining its “hold” call with an unchanged sum-of-parts target price of RM8.22.
For now, Maybank IB said it is not making changes to its financial year 2025 (FY25) to FY27 earnings estimates and its annual dividend per share assumption of 36 sen.
MISC is a leading provider of energy-related maritime solutions and services.
In the third quarter ended Sept 30, 2025, MISC posted a net profit of RM541.8mil, as compared to RM338.9mil in the year-ago quarter.
Earnings per share rose to 12.1 sen from 7.6 sen previously.
The group reported a lower quarterly revenue of RM2.8bil as compared to RM2.96bil in the comparative quarter.
It said this was mainly due to lower revenue from ongoing projects in the marine and heavy engineering segment, due to projects approaching completion as well as newly secured projects being in the early stages of execution, coupled with lower earning days from contract expiries, vessel disposals and lower charter rates in the gas assets and solutions segment.
During the nine-month period to Sept 30, 2025 (9M25), MISC recorded a net profit of RM1.71bil against RM1.64bil in 9M24, while revenue dropped to RM8.33bil from RM9.93bil in the previous-year period.
Moving forward, MISC expects liquefied natural gas carrier spot charter rates to remain soft, primarily due to continued vessel oversupply resulting from strong newbuild deliveries and an increasing number of vessels coming off long-term charters.
“Coupled with high inventory levels in Europe and subdued demand in Asia, spot charter rates are expected to come under sustained downward pressure for the remainder of the year.
“The prevailing weakness in the spot market presents potential asset impairment risks that may affect the segment’s long-term asset valuations,” it said in a filing with Bursa Malaysia earlier.
