Swiber: Religare initiates with Buy Call and $0.86 TP. Note that Swiber’s orderbook has hit an all-time high of over USD1.4b, and is in the running for a set of large contract wins in India, and Brunei, amongst others.
Enlarged fleet represents capacity to expand orderbook and rev. Since 2006, Swiber has grown its fleet from just 9 vessels to 53 today. Its enlarged fleet is only 65-70% utilized, hence represents potential for the company to expand its orderbook and rev above current levels. Co is also expanding its fleet further due to contract opportunities visible on the horizon.
TP equates to 1.0x adjusted 2012E PBV, adjusted for a future conversion of grp’s convertible bond. Swiber is currently trading at 6.3x 2012E P/E and 0.7x 2012E unadjusted P/B, which is cheaper than peers.
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