Keppel's 16% profit crash is still good news

You'll be surprised why.

According to Nomura, with a record SGD13.1bn net orderbook, globally recognised brand name facilities and track record, and a broadening Offshore & Marine product base (eg. FLNG development) thanks to an innovative R&D team, it believes Keppel is well placed to weather the more turbulent and competitive environment in 2013/14.

Here's more from Nomura:

Keppel posted a 47% y-y rise in 9M12 net profit to SGD1.62bn, helped by strong property bookings. While 3Q12 net profit declined 16% y-y to SGD346.4mn, this was ahead of our estimate on stronger-than-expected O&M and property bookings.

EBIT margins continue to come in within the guided range of 12-15%, with 3Q12 group EBIT at SGD432.6mn (-17% Y-y) and margins firm at 13.4%.

Stronger-than-expected new order wins spurred by stubbornly high oil prices and limited newbuild availability can be a key catalyst, in our view.

Margins can surprise on the upside as Keppel moves on to book revenue from better priced jack-ups secured later in the 4Q10-2011 period.

We have cut our target marginally to SGD13.20 (from SGD13.80 earlier) mainly due to roll over of our DCF model to 2013. Keppel now trades at FY13/14F P/E of 13.1x/12.4x vs historical P/E band of 8x and 22x with dividend yield of 4.6% and ROE averaging 16.5%, which is attractive relative to peers in our view.

Also Read

Shell pipeline leaks oil into Singapore’s Bukom Island

Changi Airport Group unveils three faster vessels for sea rescues

Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

I want to download the media kit