OSK 2013 Strategy for Oil & Gas Sector



O&GOSK is bullish on the O&G industry in the immediate term as it would be very soon before new contracts are awarded, including:

  • RM8-10bn worth of hook-up commissioning in the Pan Malaysia cluster
  • marginal oilfields
  • replacement of expiring brownfield contracts.

OSK’s top picks for the sector is SapuraKencana Petroleum (BUY FV RM3.00), Dialog (BUY FV: RM3.45) and Dayang (BUYFV: RM2.90). They like these companies for their excellent track records and believe that in the event of a slowdown in contract awards, they would still have strong orderbook.

Below are the target prices and ratings for selected Oil & Gas stock.

Stocks Price (RM)* Target price (RM) Market Cap (RM million) Rating
Alam Maritim 0.685 1.25 539.2 Buy
Bumi Armada 3.81 4.35 11,160.1 Buy
Coastal 2.00 2.44 966.5 Buy
Dayang 2.47 2.90 1,358.5 Buy
Dialog 2.41 3.45 5,837.9 Buy
KNM 0.465 0.49 692.9 Neutral
MMHE 4.46 4.76 7,136.0 Neutral
Petra Energy 1.63 1.94 349.6 Buy
Perdana Petroleum 1.00 1.17 495.1 Buy
SapuraKencana
Petroleum
2.97 3.00 14,863.0 Buy
Wah Seong 1.73 2.13 1,340.6 Buy

* as of 14th December 2012

Source : OSK Research


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