Monday, July 30, 2007


Petronas Carigali has extended the contract to Sapuracrest's tranportation and installation of offshore facilities that was awarded btw 2004-2006 for a further 3 years, ending in March 20010. Contract value has gone up by 50% to RM3bn. The works will be for the fields offshore of Terengganu, Sabah and Sarawak which include the Angsi, Samarang, Sumandak, Bekok and Bertam fields. The works would involve the installation of subsea pipelines and the transportation and installation of drilling, production and wellhead platforms. Hence contracts secured year to date have reached RM3.8bn. This include the extension of Exxon Mobil's RM200m contract for installation works at Tapis, Guntong and Jereh fields off Terengganu and aother RM606m contract from Murphy Oil for the instllatin and commissining of the 140km gas ipeline transportation from the Kikeh fields to the Labuan Gas Terminal. This will boost Sapuracrest's order book to RM6bn which will carry them for at east the next 3 years.

For 2008 the company should be making a net profit of R70m before jumping to RM170m in 2009. EPS will be around 6.2 sen and 15.1 sen respectively. I would expect Seadrill to continue buying shares even past the 20% threshold, and more contracts coming in soon. I see little resistance to the share prce hitting RM4 sometime this year. Considering the many oil and gas stocks already doubling or even tripling in share price with very small contracts to boast of, Sapuracrest is looking to be still my top pick from oil and gas plays.


ccdev said...

read in zemoola's blog that RHB and TA got sell/underperform on this counter. Wonder why? Does anyone have a copy of the report from the brokerage houses?

SalvadorDali said...


i get access to almost all research reports... when i started to highlight the stock, i believe it was at 1.70 and there were so many sells or underperform... by ta, aseam, hwang, affin, rhb ... i think there was only one buy report by citigroup... so they were wrong since beginning of the year, and continues to be wrong ... research reports are only as good as the ability to identify the real catalysts, missing out on trends, themes is not an excuse... sticking to a proven valuation modelling technique does not absolve misreading a sector or a stock, the market is fluid and so too must be our reading ability of trends, stock specifics and unique catalysts ... if everything is predictable according to history, then thre is no need for analysts

Unknown said...

Dear Dali,

The Sapura Crest selldown seems to be even sharper than most other counters. Would you have a comment on this?

SalvadorDali said...

must look at recent trends, sapcrest has moved up from 2.00 to 2.30 and then scaled to 2.55, all within a short span of time... what that means is it has high volatility (more trading positions), plus there are more holders sitting on good profits... its very natural to see a higher than normal selldown in jittery conditions.

Sam said...

Hi Dali,
Sapcrest closed 2.30 last Friday,is it time yet to collect?Should I wait a little longer cos the market is volatile at the moment?cheers

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