February 13, 2013

Kenanga raises target price for SapuraKencana

Stock Name: SKPETRO
Company Name: SAPURAKENCANA PETROLEUM BHD
Research House: KENANGAPrice Call: BUYTarget Price: 3.82



Kenanga Research raised the target price for SapuraKencana Petroleum Bhd to RM3.82 from RM3.42 after a financing structure was announced for the company's US$2.9 billion purchase of tender-rigs from Seadrill Ltd.

"We are tactically raising our target price to accommodate the potential earnings accretion from the new rigs," said Kenanga in a report on Wednesday. Kenanga maintained its 'outperform' call on the stock.

SapuraKencana, Malaysia's largest oilfield service provider, will see its debt increase to RM5.7 billion from the acquisition, said Kenanga. The brokerage maintained its earnings forecast for the company, in spite of the higher borrowing costs.

Shares of SapuraKencana rose 1.4 per cent to RM2.89 as of 9.44am, while the benchmark index was up 0.54 per cent.--Reuters

Long Overdue Malikai TLP Win

Stock Name: MHB
Company Name: MALAYSIA MARINE AND HEAVY ENG
Research House: TAPrice Call: HOLDTarget Price: 4.60



The Winning Tender

Stock Name: SKPETRO
Company Name: SAPURAKENCANA PETROLEUM BHD
Research House: TAPrice Call: BUYTarget Price: 3.83