MISC (3816) : AmResearch maintains Hold on MISC
KUALA LUMPUR: AmResearch has maintained its Hold call on MISC with a higher fair value of RM6.90 a share as it rolled over its sum-of-parts valuations to end-2015.
"Our higher fair value stems from our upward revision of market values for petroleum tankers, but is partially offset by lower market value of MMHE based on the current share price. We have also raised our FY14F-FY15F earnings by 6%-7% as we account for improving petroleum charter rates," it said.
Stripping off gains of RM13.5mil from the disposal of its chemical vessels, MISC recorded 3QFY14 core net profit of RM457mil, bringing 9MFY14 core net profits to RM1,280mil.
"The results were largely in line within our expectation, accounting for 77% of our previous full-year estimates. Sequentially, 3QFY14 core net profits improved by 36% QoQ, largely due to higher profits from the LNG division from higher earning days and lower drydocking days, and lower losses from the petroleum division due to higher freight rates and increased lightering activities from the Aframax segment," it said.
AmResearch said MISC expects petroleum tanker charter rates to seasonally improve going into 4QFY14, as demand would pick up during the winter season.
"We should therefore see the petroleum division’s losses narrow further for the year. LNG rates remain under pressure due to the huge delivery of new vessels. Although MISC is currently insulated from this due to its long-term charters, note that the Puteri Intan tanker charter with Petronas has expired and will be undergoing refurbishments, while four more charters will expire over the next three years," it said.
http://www.thestar.com.my
KUALA LUMPUR: AmResearch has maintained its Hold call on MISC with a higher fair value of RM6.90 a share as it rolled over its sum-of-parts valuations to end-2015.
"Our higher fair value stems from our upward revision of market values for petroleum tankers, but is partially offset by lower market value of MMHE based on the current share price. We have also raised our FY14F-FY15F earnings by 6%-7% as we account for improving petroleum charter rates," it said.
Stripping off gains of RM13.5mil from the disposal of its chemical vessels, MISC recorded 3QFY14 core net profit of RM457mil, bringing 9MFY14 core net profits to RM1,280mil.
"The results were largely in line within our expectation, accounting for 77% of our previous full-year estimates. Sequentially, 3QFY14 core net profits improved by 36% QoQ, largely due to higher profits from the LNG division from higher earning days and lower drydocking days, and lower losses from the petroleum division due to higher freight rates and increased lightering activities from the Aframax segment," it said.
AmResearch said MISC expects petroleum tanker charter rates to seasonally improve going into 4QFY14, as demand would pick up during the winter season.
"We should therefore see the petroleum division’s losses narrow further for the year. LNG rates remain under pressure due to the huge delivery of new vessels. Although MISC is currently insulated from this due to its long-term charters, note that the Puteri Intan tanker charter with Petronas has expired and will be undergoing refurbishments, while four more charters will expire over the next three years," it said.
http://www.thestar.com.my
