Ezion

Ezion: CLSA remains optimistic for a strong 2H performance on new contract wins and expect momentum to pick up over next couple of months. House expects Ezion to bag 12 contract wins for FY14 (five clinched year-to-date) and eight in FY15. Management clarified that recent issues at its largest and most complex project “Prime Exerter” is not a structural execution issue, as the turn-key project indicates that Ezion does not have its own people on the ground to manage the project. Strong demand environment underpinned by Malaysian enhanced oil recovery projects represent the largest opportunities for deployment of liftboats/service rigs and Ezion is the only qualified contractor currently. CLSA maintains its long standing Buy rating on Ezion with a TP of $2.82.