SMM

SMM: secured orders for 2 turnkey contracts with a combined value of US$417m for the construction of two units of jack up rigs from repeat customer Oro Negro. The high spec rigs, scheduled for delivery at end 4Q14 and end 1Q15, come at a lower price tag vs the earlier order from Oro Negro (in Dec ’12) at US$434m. Ytd, SMM has clinched orders for 3 jackups valued at $1.74b, and is a testament to the continued strong order flow from the industry. The stock trades at 17.6x P/E, 3.9x P/B.