Ezion

Ezion: CIMB note that Ezion has been the main beneficiary of Australia's LNG capex boom among stocks under its coverage, noting it landed its fourth marine-logistics contract for the Australia Pacific LNG project. With Australia's LNG export capacity expected to top 100Mtpa by 2020 vs the current 24Mtpa, the outlook remains cheery. House expects that the US$71m contract won't have a material earnings impact as it expects 5% net margins, due to using third-party vessels, on revenue of $35m-S$40m p.a. It estimates margins on work using owned-vessels at 30%. There is upside earnings potential if Ezion decides to splurge on newbuilds. It says Ezion remains its top pick in the small- to mid-cap offshore segment. Offering the best earnings growth and ROE prospects, it is the cheapest in P/E and P/BV terms among its peers. House keeps an Outperform call, but trims TP to $1.14 from $1.15 after fine-tuning its EPS estimates.