AmInvestment maintains 'buy' on Sapura Energy

TheStar Fri, Jan 08, 2021 08:59am - 3 years View Original


KUALA LUMPUR: AmInvestment Bank Research expects Sapura Energy Bhd's order book to be boosted by nearly a third if it secures its bid for a contract for the central processing platform for SapuraOMV Upstream Sdn Bhd's Jerun field development in offshore Sarawak.

"We estimate that securing this project alone could boost Sapura’s outstanding order book of RM12.5bil by 32%, reversing its declining sequential trend over the past 2 quarters," it said in a note.

The research house estimates the contract value for the central processing platform weighing 22,000 tonnes, plus 5,300 tonnes of piles and an 8,500 tonne compression platform could easily be worth over US$1bil.

It cited a report from an oil and gas news portal that the group is expected to edge out the only other bidder, Malaysia Marine & Heavy Engineering Bhd, for the contract.

However, the news portal noted that MMHE is still hopeful of securing the contract, which is expected to be formally awarded by the end of the month.

AmInvestment has a "buy" recommendation on Sapura Energy with a fair value of 29 sen a share, pegged to a 50% dicount to the group's FY21 book value.

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