May 19, 2010

MAYBULK - OSK Research reiterates neutral call on Maybulk

Stock Name: MAYBULK
Company Name: MALAYSIAN BULK CARRIERS BHD
Research House: OSK

KUALA LUMPUR: OSK Investment Research has reiterated its neutral recommendation on Malaysia Bulk Carriers Bhd (Maybulk) at RM2.99 with target price RM3.03 and said the company's 1Q core earnings were above its own and street estimates.

The higher time charter rates coupled with stable hire days lifted contributions from the bulker and tanker side but this was offset by lower contribution from the offshore business, it said.

"Despite expecting a better POSH contribution in 2H, we are cautious on the outlook of the bulker and tanker markets as newbuildings may give rise to a supply overhang.

"Therefore, we reiterate our neutral recommendation with a sum-of-parts target price of RM3.03," it said.

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