Keppel Corp

Keppel Corp: According to a CS report on group's 1H13 results, house expect 2Q13 net profit of $420m which would represent 27% of consensus FY13 net profit of $1.56b. CS expect a q/q improvement in the O&M margin to above 15.0% in 2Q13 from 14.1% in 1Q13, driven by an acceleration in rig deliveries. In 2Q13, Keppel delivered seven out of 20 jackup rigs due in 2013, an increase from the five units delivered in 1Q13. The rigs were delivered ahead of schedule by an average of 19 days, earning Keppel a combined bonus of US$2.2m. Keppel Merlimau Cogen could contribute more to infrastructure profit in 2Q13 with the completion of its 400MW expansion in late March. The average electricity pool price was firm in 2Q13, increasing to $185/MWh from $175/MWh in 1Q13, driven by a rise in electricity demand during the haze. CS maintain its OUTPERFORM rating on Keppel, which is its top pick within the Singapore offshore and marine sector. Keppel is a Credit Suisse NJA Focus List stock.