0829 GMT 20 July [Dow Jones] STOCK CALL: Daiwa raises its Keppel (BN4.SG) FY12 order-win forecast to S$10.5 billion from S$9.5 billion. “The rig-order cycle is still intact, as evidenced by the company’s strong order flow this year,” it says. With the December 2015 Brent forward oil price currently at US$93/bbl, “all deepwater projects are profitable at this level,” keeping rig owners reasonably secure about assets in the next 2-3 years and underpinning the rig-order cycle, Daiwa say. It notes 2Q12 net profit rose 35% on-year to S$521 million, beating its forecast by 13% on better-than-expected operating profit margins and one-off property contributions. It notes 2Q12 operating profit margin of 13.2% for the O&M segment beat its 12.5% forecast. “We like the company’s exposure to the offshore and marine segment and its strong historical track record of executing its projects on time and on budget.” It raises its target to S$12.25 from S$12.00 after increasing FY12-14 EPS forecasts by 2%-3%.
It keeps an Outperform call. The stock falls 0.5% to S$11.18.
- Leslie Shaffer, Dow Jones Newswires