OSK remain OVERWEIGHT on the O&G industry and Buy calls on both Coastal and Dayang.
OSK like Coastal for its mergers and acquisition story. OSK re-iterate their view that it would be a matter of time before Coastal finds itself a suitable partner for M&A purposes.
OSK also like Dayang due to it’s stable, recurring income. This is because oilfield and platform maintenance are all-year-round jobs and having a slice of this business pie is always better than getting one-off jobs as they provide assurance of future earnings sustainability
Below are the target prices and ratings for selected Oil & Gas stock.
| Stocks | Price (RM) | Target price (RM) | Market Cap (RM million) | Rating |
|---|---|---|---|---|
| Alam | 0.79 | 1.45 | 621.9 | Buy |
| Bumi Armada | 3.95 | 1.45 | 11,567.4 | Neutral |
| Coastal | 2.06 | 5.15 | 995.5 | Buy |
| Dayang | 1.75 | 5.15 | 962.5 | Buy |
| Dialog | 2.52 | 3.12 | 5,030.0 | Buy |
| Kencana | 2.70 | 3.17 | 5,366.1 | Buy |
| KNM | 1.53 | 3.91 | 1,531.7 | Tr Buy |
| MMHE | 6.50 | 8.23 | 10,400.0 | Neutral |
| PCHEM | 6.33 | 9.28 | 50,640.0 | Buy |
| P Energy | 1.30 | 2.34 | 253.5 | Buy |
| P Perdana | .64 | 1.50 | 288.1 | Buy |
| Tgoff | 0.94 | 1.29 | 274.4 | Neutral |
| WSC | 2.19 | 3.50 | 1,614.0 | Buy |
Source : OSK Research