Nam Cheong

Nam Cheong: Following Nam Cheong’s recent contract wins for two vessels worth ~US$43.1m, which brought its orderbook to RM1.4b, we note of a wave of buy reiterations on the counter. Accordingly, Nam Cheong’s recent share price decline in recent months was attributed to comments made by Petronas which cautioned of falling charter rates in Malaysia and the possibility of an over-supply of OSVs in Malaysia. Analysts have however been quick to shrug this off, deeming the concerns as unfounded and highlighting the expansion of financing to OSV owners by the Malaysia Development Bank which will enable boost demand for vessels. Furthermore, the strong charter momentum should act as an impetus for vessel owners to continue turning to build-to-stock players for early delivery.