- Hong Leong Investment Bank (HLIB) Research is positive on the outlook of shipping firm MISC, based on its resilient petroleum tanker charter rate and strong support from its parent group, Petroliam Nasional (Petronas).
- The group has set a five-year strategic growth plan focusing on three core segments – petroleum shipping; offshore floating production storage and offloading vessels (FPSO) and floating storage and offloading vessel (FSO); and liquefied natural gas (LNG) shipping.
- According to the research house, the firm looks forward for potential fleet expansion (second-hand market or new build) given the expected sustaining favourable charter rates (for 2016 to 2017) with current low asset prices.
Significance: Expecting charter rate to be resilient with sustained profitability for coming years, HLIB Research has maintained its ‘Buy’ recommendation on the stock with a target price of RM9.00. The research firm also noted the possibility of a higher dividend payout, with proceeds from the sale of VTTI for US$830 million (RM3.5 billion) by 2016.
Contributed by Shares Investment