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Tuesday, November 25, 2014

Triyards Holdings started at "buy", 92-cent target by AmFraser


SINGAPORE (Nov 25): AmFraser has started coverage on Triyards International with a "buy" call and price target of 92 cents, based on nine times projected FY2015 earnings.

Ezion Holdings ( Financial Dashboard)' recent move to subscribe for warrants issued by Triyards signals its confidence in the builder of lift boats, according to AmFraser.

"This will also provide a boost to its order book – potentially adding around US$150 million to Triyards’ order book, which would bring (it) to an all-time high of US$550 million, giving visibility over the next two years," it said.

The recent pullback in Triyards' shares amid falling oil prices "does not reflect the fundamentals of liftboat demand", AmFraser said.

"Liftboat demand will mainly be driven by the increasing acceptance from operators and from offshore operational activities to maintain and extract additional oil and gas from existing shallow offshore platforms."

In a "worst-case scenario" where the subscription agreement with Ezion does not go through, Triyards' order book should still sustain the company for another 1.5 years, said AmFraser.

"That should give it ample time to secure more orders."

Triyards shares fell 1.5% to 65 cents at 10:42am (0242 GMT).

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