Friday, November 4, 2011

Maybank IB Research maintains Buy on MMHE

KUALA LUMPUR (Nov 4): Maybank Investment Bank Research is maintaining a buy on Malaysia Marine and Heavy Engineering Bhd (MMHE) at a target price of RM8, based on 20 times 2013 earnings per share.

It said on Friday that MMHE's latest Tapis contract, valued at RM1.4 billion, readily filters concerns over its replenishment rate.

'Orderbook momentum is set to continue into 2012-15 with the FLNG, TLP and RAPID projects among the high profile projects that would propel orders and earnings growth. MMHE remains as among our top pick in the oil & gas sector,' it said.

Maybank IB Research said the job scope entails the CONSTRUCTION [] and installation of the main structure for the Tapis R topside.

The Tapis R topside is an 18,000MT integrated deck that includes facilities for gas compression, water injection, production separation and living quarters for 145 personnel.

'A RM1.4b job with an 18-month delivery date. Works will be undertaken at its Pasir Gudang yard. Installation of facilities is scheduled to commence in 2Q 2013 and EMEPMI targets to start production by end-2013. The Tapis R platform will be connected by a bridge to the existing Tapis B platform and a new riser platform, known as Tapis Q,' it said.

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