KUALA LUMPUR, Sept 28 (Bernama) -- Bursa Malaysia ended marginally lower on Monday amid selling activity as the market lacked fresh catalysts to spur investors’ buying interest, an analyst said. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 1.60 points, or 0.09 per cent, to 1,670.02, from Friday’s close of 1,671.62. The benchmark index, which opened 0.93 of-a-point higher at 1,672.55, moved between 1,668.61 and 1,674.11 throughout the trading session. Market breadth was negative as losers surpassed gainers 748 to 388, while 517 counters were unchanged, 1,271 untraded and 91 suspended. Turnover slipped to 3.11 billion units worth RM2.40 billion from 4.07 billion units valued at RM2.69 billion on Friday.
Maintain an outperform call with unchanged target price (TP) of RM1.90
SapuraKencana Petroleum (SAKP) announced last Friday that its various wholly-owned subsidiaries have been awarded USD215m (RM889m) worth of contracts collectively. The awards are for the engineering and construction (E&C) division, which will provide further earnings visibility for up to 2 years based on the longest duration of the following contracts awarded. We continue to recommend SAKP with an Outperform call, with our unchanged TP of RM1.90 based on a blended SOP valuation.
ONGC award. For a duration of 20months, the Group secured a contract in relation to the B127 Cluster Pipeline RTR Project. The job scope includes engineering, procurement, construction, installation and commissioning of 11 pipeline systems and associated topside modifications in B127 and surrounding Mumbai High fields located off the west coast of India. The award is to a consortium of SapuraKencana TL Offshore Sdn. Bhd. and SapuraKencana HL Sdn. Bhd.
SKD Pelaut contract was awarded by Brunei Shell Petroleum Sdn. Bhd. for a duration of 2 years and an additional 2-year optional period The contract is for the provision of the SKD Pelaut Tender Assist Drilling Rig awarded to SapuraKencana Drilling Asia Limited.
Sepat MOPU contract. SapuraKencana Subsea Services Sdn. Bhd. was awarded an estimated 2-month contract by Petronas Carigali Sdn. Bhd. (PCSB) for the provision of underwater maintenance services for the Sepat MOPU. The job scope includes inspection, maintenance, repairs, drilling support and other work for PCSB’s underwater facility. The works will be executed in the water shore and offshore Peninsular Malaysia at 0-2,000 meters depth, with diver intervention at 0-300 meters water range at the Sepat MOPU Field.
Reiterate Outperform. Reaffirmed by more contract replenishments in the pipeline for the E&C division, the Group’s orderbook to-date stands at RM4.2bn including these new ones awarded. We are maintaining our estimates due to the earlier assumptions of replenishments having already accounted for this.
Source: PublicInvest Research - 04 October 2016
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