Stock Name: ALAM
Company Name: ALAM MARITIM RESOURCES BHD
Research House: CIMB
KUALA LUMPUR: ALAM MARITIM RESOURCES BHD [] shares rose on Wednesday, April 20 as CIMB Research said the company's plan to venture into pipe installation was coming to fruition, and upgraded the stock to Buy from Sell previously.
At 9.15am, Alam was up nine sen to RM1.14 with 3.99 million shares done.
The research house said that Alam's 50:50 JV with Swiber was set to clinch a US$50 million to US$60 million contract relating to Petronas's Sabah oil & gas terminal (SOGT) and was teaming up with the Sabah state agency Yayasan Sabah on O&G related works.
CIMB Research said imputing the contract in its FY11 forecasts and assuming the award of similar-sized contracts in FY12-13, it raised its EPS by 16.9% for FY11, 13.3% for FY12 and 11.1% for FY13.
'Given Alam's improving prospects, we now value it at a 20% discount to our 14.5x target market P/E instead of 30%, which, together with our earnings upgrades, increases our target price from RM1.03 to RM1.40.
'We upgrade Alam from Sell to Buy, with the potential catalysts being 1) the announcement of the SOGT contract, and 2) more pipe installation ventures,' it said.
Company Name: ALAM MARITIM RESOURCES BHD
Research House: CIMB
KUALA LUMPUR: ALAM MARITIM RESOURCES BHD [] shares rose on Wednesday, April 20 as CIMB Research said the company's plan to venture into pipe installation was coming to fruition, and upgraded the stock to Buy from Sell previously.
At 9.15am, Alam was up nine sen to RM1.14 with 3.99 million shares done.
The research house said that Alam's 50:50 JV with Swiber was set to clinch a US$50 million to US$60 million contract relating to Petronas's Sabah oil & gas terminal (SOGT) and was teaming up with the Sabah state agency Yayasan Sabah on O&G related works.
CIMB Research said imputing the contract in its FY11 forecasts and assuming the award of similar-sized contracts in FY12-13, it raised its EPS by 16.9% for FY11, 13.3% for FY12 and 11.1% for FY13.
'Given Alam's improving prospects, we now value it at a 20% discount to our 14.5x target market P/E instead of 30%, which, together with our earnings upgrades, increases our target price from RM1.03 to RM1.40.
'We upgrade Alam from Sell to Buy, with the potential catalysts being 1) the announcement of the SOGT contract, and 2) more pipe installation ventures,' it said.
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