STOCK CALL: Nomura Raises SembMarine's Target

[Dow Jones] STOCK CALL: Nomura raises SembMarine’s (S51.SG) target To S$6.08 from S$4.50 after increasing FY12-13 earnings estimates by 9%-10% on improved new-order outlook and offshore margins. “Despite macro headwinds over the past two quarters, offshore rig day rates and utilization have stayed firm, with oil prices still at six-month highs and national oil companies continuing to open up new deepwater blocks for offshore exploration. We expect these favorable industry tailwinds to continue to bolster demand for deepwater rig newbuilds and offshore production vessels, and rekindle new orders after the recent lull.” After the award of the US$793 million drillship contract from Sete Brasil, it expects more significant contract awards are imminent. It keeps a Buy call. The stock is down 0.2% at S$5.03.

  • Leslie Shaffer, Dow Jones & Co