Kreuz

Kreuz: UOB Kay Hian maintains Buy with $0.68 TP. Note that Kreuz has recently inked a deal to build a game-changing deepwater subsea vessel, which will lift the group’s capability to match that of leading global subsea players. Expect the vessel to contribute a net profit of US$6m-11m per year, lifting earnings by 13-23%. Maintain BUY with higher target price of S$0.68 (previously S$0.53), given attractive 2014F PE of 4.5x and a respectable 4-year EPS CAGR of 15% (2011-15). Kreuz’s current tenderbook remains at about US$450m-500m, unchanged from three months back. House expect Kreuz to win 20-30% of its current tenderbook. Ytd, Kreuz has clinched US$15.5m worth of orders, bringing end-12 orderbook to US$205m.