Bursa Malaysia Stock Price Target: MAYBULK

KUALA LUMPUR: Shares of Malaysian Bulk Carriers Bhd (Maybulk) dropped as much as 3.77 per cent after the country's second largest shipping firm's second-quarter earnings missed market expectations.

By 11:35 a.m. (0335 GMT), the counter dropped 2.52 per cent to RM1.55 per share with 291,500 shares traded, as compared with an average of 235,423 shares during the past 30 trading days. The broader index shed 0.1 per cent.

"With rates having tumbled 41 per cent year-on-year amid higher charter costs, Maybulk posted a surprise loss of RM1.2 million in the second quarter ended June 30, 2012, which disappointed our and street expectations," OSK Research said in a note on Friday.

Maintaining a 'sell' on the counter, the research house downgraded Maybulk's fair value to RM1.27 per share from RM1.46 previously.

"We expect the outlook to remain challenging and weakness to persist in the immediate term," OSK added. -- Reuters

Profits plunged but cushioned by associate

Stock Name: MAYBULK
Company Name: MALAYSIAN BULK CARRIERS BHD

Research House: MIDF

Price Call: HOLD

Target Price: 1.68

February 29, 2012

MAYBULK (FV RM1.60 - SELL) FY11 Results Review: Struggling With Sinking Rates

Stock Name: MAYBULK
Company Name: MALAYSIAN BULK CARRIERS BHD

Research House: OSK

Price Call: SELL

Target Price: 1.60

Maybulk's FY11 core earnings of RM103.4m were 18% below ourestimates but within consensus, with revenue in line. The lower profit was in tandem with the lower time charter earnings (TCE) at its dry bulk division on the back of high bunkeringcosts. In view of the lower rates for Panamaxes, we expect revenue to drop14.7% in FY12. We maintain our revenue forecast but cut our FY12 and FY13 earnings numbers by 13% and 7% on persistent pressure on bunker fuel. We maintain our SELL call, but at higher fair value of RM1.60, premised on a 0.85x FY12 P/B, due to the lower estimated dividend (down from 8 sen to 3 sen for FY12).

Below. Save forthe net exceptional loss of RM12m for FY11, Maybulk's core earnings of RM103.4m(y-o-y: -52%) were below our estimatesby 18% but within consensus on the back of revenue of RM265.3m (y-o-y: -37%y-o-y), which were in line. In view of the lower earnings, the dividenddeclared was lower at 3 sen vs 10 sen in FY10.

Lower rates drag downearnings. The lower profitability was in tandem with the lower TCE (FY:USD16.5k/day, y-o-y: -36%) recorded byits dry bulk division owing to higher bunkering costs. Although its tankers'TCE was marginally higher by 2% at USD12.3k/day, the docking of its 3 producttankers caused its revenue to dive 24% y-o-y while revenue from the bulk sidesank 39%. Despite the lower profits, MBC still recorded better rates across itsfleet compared to its average peers due to its ability to lock in higher TCEsearlier. Its asset utilization remained healthy at 97.5% (vs 98.4% in FY10).

Outlook stillbleak, cutting earnings. We expect slightly lower ratesin 2012 on the Panamax side, while the Handymax and the Handysize segments willsee TCE stabilize. However, as 48% of MBC's total dwt comprises Panamaxes, westill expect revenue to decline by 14.7% y-o-y (revenue is maintained for FY12and FY13). Meanwhile, its average capacity in dwt is expected to grow 9% in2012 (with 3 vessels to be delivered this FY ' one in Jan and the remaining 2in April and Oct) with hiring days growing by the same quantum. Due tooversupply concerns and potential risk of further downside in asset value, theincoming capacity for the next 2 years will be on a charter basis, but withpurchase options. Earnings-wise, management expects to be profitable in FY12.In view of the continued pressure from high bunker fuel, we trim our earningsforecasts for FY12 and FY13 by 13% and 7% respectively. The offshore vesselsector is seeing better vessel utilization although rates are still lagging. Weexpect better numbers from POSH.

Maintain SELL. Wemaintain our SELL call, with a higher FV of RM1.60 (premised on a 0.85x FY12P/B), due to the lower dividends (reduced from 8 sen to 3 sen for FY12).

Source: OSK188

Malaysian Bulk Carriers - A rocky boat ride

Stock Name: MAYBULK
Company Name: MALAYSIAN BULK CARRIERS BHD

Research House: CIMB

Price Call: SELL

Target Price: 1.65

Target RM1.65

Maybulk's FY11 core net profit missed the boat by 20% because of additional cost items and lower earnings from its associate, POSH. The improvement in bulk earnings is unlikely to continue this year as the BDI has since plunged to a 26-year low.

Source: CIMB Daybreak February 29, 2012, Full PDF Report

January 31, 2012

Freight rates have bottomed, but it will be a "long" U-shaped recovery

Stock Name: MAYBULK
Company Name: MALAYSIAN BULK CARRIERS BHD

Research House: MIDF

Price Call: TRADING SELL

Target Price: 1.61

December 29, 2011

Maybulk advances on rising volume despite cautious outlook

Stock Name: MAYBULK
Company Name: MALAYSIAN BULK CARRIERS BHD

Research House: TA

Price Call: SELL

Target Price: 1.10

Larger Smaller Reset KUALA LUMPUR (Dec 29): MALAYSIAN BULK CARRIERS BHD [] (Maybulk) share price advanced in late afternoon trade on Thursday, climbing to a high of RM1.59, despite concerns about a tough 2012 environment for the dry bulk shipping industry.

At 3.57pm, Maybulk was up 13 sen to RM1.58. There were 5.09 million shares done at prices ranging from RM1.46 to RM1.59.

In a recent report, TA Securities Research said its Underweight stance on the dry bulk shipping industry remained intact as it believed the global shipping market was posed for a tough 2012.

'Indeed, Malaysian Bulk Carriers Berhad (Maybulk)'s management foresee a challenging operating environment going forward. Capacity glut and unstable operating costs, primarily due to volatile bunker costs will continue to threaten shipping line profit margins,' it said.

TA Research said the situation may be exacerbated by unusual weather conditions and natural disasters.

Due to the lacklustre industry outlook and the industry's chronically low profitability, it believed the share price appreciation potential is limited for Maybulk. It added the recurring problem in the shipping sector was still the oversized orderbook as there would be another wave of big ships coming to the industry next year.

'We reiterate our Sell recommendation on Maybulk with a target price of RM1.10 based on Sum-of-Parts valuation methodology. We believe Maybulk appears fully valued within the sector with the recent increase in share prices.

'Potential catalysts to upgrade our target price include: (i) a strong and sustained rebound in Baltic Dry Index, (ii) a faster-than-expected economic recovery; and (iii) better than expected earnings contribution from POSH (PACC Offshore Services Holdings Pte Ltd),' TA Research said.

May 26, 2011

MAYBULK - Malaysian Bulk cut to 'neutral'

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

Malaysian Bulk Carriers Bhd was cut to “neutral” from “buy” at OSK Research Sdn Bhd to reflect “depressed” shipping rates.

The stock’s fair value was reduced to RM2.21 from RM3.10, OSK said in a report in Kuala Lumpur today. -- Bloomberg

February 8, 2011

MAYBULK - OSK Research ups Maybulk to Buy, downgrades MISC

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

KUALA LUMPUR: OSK Research said trimming excess supply is now vital in restoring shipping rates.

It said on Tuesday, Feb 8 that given the higher incidence of scrapping among smaller vessels (generally the older ones), it prefers shipping players with a higher composition of smaller ships.

OSK Research said nevertheless, as supply and demand is still imbalanced, it continues to maintain its NEUTRAL call on the sector as the tide has yet to turn positive.

'We have upgraded Malaysian Bulk Carriers (Maybulk) to BUY (TP RM3.10) as we believe that the BDI may soon bottom. However, we have downgraded MISC to NEUTRAL (TP RM8.72) on an earnings cut of 6%-7% as tanker rates continue to languish,' it said.