Ezra

Ezra announced yesterday that it has secured a new contract worth up to US$80.0m. This order will see Ezra fabricate and deliver an offshore accommodation structure for an international O&G offshore engineering and construction company to be deployed for a major O&G player. we understand the accommodation structure will be manufactured by the Group’s fabrication and engineering services base in Vietnam.

Notably, this latest contract is Ezra’s 2nd major win since it deployed its maiden self-propelled jack-up in Africa early this year. Going forward, the group will continue to tender for more contracts, especially in fast-growing markets such as the African and North American offshore sectors. We note that share price has corrected about 34% since Apr 2010 and is now trading at a more reasonable valuation of 11x FY10 and 7.6x FY11 P/E. Deutsche has a BUY rating on the stock with TP of S$2.80.