Malaysia Marine & Heavy Engineering (MMHE)

Malaysia Marine & Heavy Engineering (MMHE)

Postby winston » Mon May 30, 2011 9:51 am

Not vested

Malaysia Marine & Heavy Engineering:Another made-in-Malaysia quasi-monopoly( RM7.3 / PT: RM9.28 ) by Muzhafar Mukhtar

Action: BUY on value-accretive acquisition; TP raised to MYR9.28

MMHE has entered into an MoU to acquire Sime Darby Engineering’s Pasir Gudang yard for MYR399mn (USD133mn).

Whilst we had written about the potential for this acquisition, the price was a pleasant surprise to us (we had feared premiums could go up to 100%).

With greater clarity on the details surrounding this transformational acquisition, we turn positive on the stock.

We update our numbers assuming a successful acquisition and raise our target price to MYR9.28; this upgrade is not based on higher multiples (our EVA-based valuation remains) but expected improvement in earnings from 2013 onward, in line with the doubling of capacity.

Source: Nomura
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Re: Malaysia Marine & Heavy Engineering (MMHE)

Postby winston » Wed Mar 13, 2019 10:01 am

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MMHE (MMHE MK)
BUY (unch)
TP: MYR1.00 (unch)

FY18 core results came in above our expectation, on a stronger-than-expected 4Q18 (+MYR1m).

At the headline level, MMHE reported a MYR26m impairment loss on trade receivables from two projects.

We remain positive on MMHE. Its financial footing is strong. It is in a net cash position (MYR0.34/shr). It withstood the cyclical downturn, emerged resilient and is entrenched to ride the recovery.

Winning one sizeable job alone (>MYR1b) by YE, a realistic target as the tender pipeline continues to improve, will re-rate the stock.

In our view, MMHE is ahead in the bids for:
(i) CPP Kasawari and
(ii) Limbayong FPSO conversion works slated for this FY.

Valuations are undemanding, with the stock trading at its PBV trough. Our TP is pegged to 0.9x EV/ order backlog, premised on -1SD and 5-year order backlog average of MYR1.1b.

Source: Maybank
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Re: Malaysia Marine & Heavy Engineering (MMHE)

Postby winston » Thu Apr 11, 2019 10:51 am

MHB joint venture gets Petronas service contract

by Syahirah Syed Jaafar

KUALA LUMPUR: Malaysia Marine and Heavy Engineering Holdings Bhd’s (MHB) wholly-owned unit has bagged a service agreement contract from Petroliam Nasional Bhd (Petronas).

In a statement yesterday, MHB said Malaysia Marine and Heavy Engineering Sdn Bhd, in a joint venture agreement with Hiap Seng Engineering Ltd, was awarded a master service agreement that covers integrated plant turnaround works and daily maintenance work on mechanical static for Petronas’ plants across the group.

The agreement is valid for five years, and Petronas has an option to extend it. No contract value was mentioned in the statement.

“This long-term project award is aligned with our strategy to venture into new businesses that provide recurring orders in ensuring MHB’s growth sustainability.

We are committed to execute the work efficiently, without compromising on safety and quality,” said the groups managing director and chief executive officer Wan Mashitah Wan Abdullah Sani.

Source: The Edge

https://www.theedgemarkets.com/article/ ... e-contract
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MHB

Postby winston » Wed Nov 06, 2019 9:14 am

not vested

Trading Buy: MHB - 5186
A turnaround play backed by solid balance sheet and parental support
(Last price: RM0.865, Potential upside +17.9%)

Company Profile

MHB (listed in Oct 2010) provides solutions for the O&G sector including building and installing offshore structures, marine repair of vessels including large LNG and LPG carriers and tankers, and marine conversion of vessels. In 9MFY19, the marine repair & conversion and heavy engineering divisions contributed about 41% and 59% to revenue, respectively.

Trading Catalyst

We remain sanguine over MHB's prospects and current price rally has legs in anticipation of improving 4Q19 results and a meaningful turnaround in FY20-21.

Despite surging 58.7% YTD, valuation is unjustifiably trading at 0.58x P/B (66% below peers’ average of 1.73x), supported by solid net cash/share of RM0.32 (37% of share price) and multi-year high RM2.7bn order-book (providing earnings visibility for the next 3 years) after securing the Kasawari project coupled with solid tender-book of RM13.7bn (signifying greater contract award opportunities).

In addition, MHB is likely to enjoy strong parental support (via MISC’s 66% stake) and beneficiary of PETRONAS’ future developments.

Technically, the stock is poised for further appreciation to RM0.97-1.02 levels after staging a bullish V-shaped recovery.

Technical View
Resistance: RM0.910 / RM0.970 / RM1.02
Support: RM0.845 / RM0.830
Cut loss: RM0.810

Key Financial Stats
Trading at 0.58x P/B (vs peers’ 1.73x).

Source: Bloomberg, HLIB
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Re: MHB

Postby winston » Thu Jun 04, 2020 8:58 am

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Trading Buy: MHB-5186

Turnaround in FY20; Sizable RM2.7bn orderbook and RM0.28 netcash/share to navigate the storm
(Last price: RM0.505, Potential upside +30.7%)

Company Profile

MHB (listed in Oct 2010) provides solutions for the O&G sector including building and installing offshore structures, marine repair of vessels including large LNG and LPG carriers and tankers, and marine conversion of vessels.

In FY19, the marine repair & conversion (MRC) and heavy engineering (HE) divisions contributed about 34% and 66% to revenue, respectively.


Trading Catalyst

Although short to mid-term outlook remains murky amid the disruption in work orders during the MCO period and potential tenderbook (amounted to RM17bn) destruction during this cyclical downturn, MHB’s orderbook of RM2.7bn (to sustain works for the next 2-3 years) and net cash of RM440m (28sen/share) could provide ample financial muscle to sail through FY20/21 relatively unscathed.

Valuation is also undemanding at 0.34x P/B (32% below 5Y mean 0.5x), supported by strong parental support (via MISC’s 66% stake) and could be beneficiary of PETRONAS’ future developments. Also, a privatisation possibility, based on current depressed price.

Technically, the stock is poised for a bullish triangle breakout soon to spur prices further towards RM0.56-0.66 territory.


Technical View

Resistance: RM0.560 / RM0.610 / RM0.660
Support: RM0.460 / RM0.440
Cut loss: RM0.435

Key Financial Stats

Trading at 0.34x P/B (-32% vs 5Y mean 0.5x), supported by RM0.28 netcash/share (55% of marketcap) and attractive 5.9% DY.


Source: Bloomberg, HLIB
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Re: Malaysia Marine & Heavy Engineering (MMHE)

Postby winston » Sat Feb 11, 2023 6:35 am

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MMHE returns to the black in FY22

In the fourth quarter ended Dec 31, 2022, MMHE posted a net profit of RM27.14mil, representing an earnings per share of 1.7 sen, as compared with a net loss of RM107.79mil or loss per share of 6.7 sen in the previous corresponding quarter.

Revenue in the quarter under review was slightly lower at RM424mil compared with RM432.01mil.

For the full year, the group's recorded a net profit of RM67.77mil, in comparison to a net loss of RM270.41mil in FY21.

The group reported revenue of RM1.65bil in 2022, up from RM1.47bil in the previous year.


Source: The Star

https://www.thestar.com.my/business/bus ... ck-in-fy22
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Re: Malaysia Marine & Heavy Engineering (MMHE)

Postby winston » Mon Feb 13, 2023 11:20 am

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Malaysia Marine Heavy Engr (MMHE MK)
FY22 skewed by tax credit in 4Q22
Maintain BUY and MYR0.85 TP


While FY22 core earnings came in below our expectation, at 86% of our FY estimate, we are positive on its:
(i) earnings/ operational turnaround and
(ii) 1st DPS payout since FY17.

We expect a stronger FY23, from earnings growth to improving orders and tenders pipeline. Overall, we remain positive on MMHE – net cash, undeservedly undervalued.

Our TP is unchanged, based on 0.8x EV/MYR1.2b order backlog.

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/302102.pdf
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Re: Malaysia Marine & Heavy Engineering (MMHE)

Postby winston » Tue Feb 14, 2023 7:42 am

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MMHE secures RM1.4bil contract from Carigali-PTTEP

To provide wellhead platforms and subsea pipelines for the Joint Development Area Field Development Project (Phase 6) located in the Malaysia-Thailand Joint Development Area.

The contract, which has a value of about RM1.4bil, will run for about 22 months.

"The contract is expected to contribute positively to the earnings and net assets per share of MHB for the financial year ending Dec, 31, 2023, onwards until the completion of the contract.


Source: The Star

https://www.thestar.com.my/business/bus ... gali-pptep
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Re: Malaysia Marine & Heavy Engineering (MMHE)

Postby winston » Wed Feb 15, 2023 8:01 am

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MMHE poised to win more O&G jobs

MMHE’s order book now stood at RM7.7bil, which is at a record high,

Both its engineering and marine segments are set to jointly record a three-year earnings at a compound annual growth rate of 86.9% over financial year 2022 (FY22) till FY25.

Wind farm projects will take up 60% of East Yard utilisation.


Source: The Star

https://www.thestar.com.my/business/bus ... re-og-jobs
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Re: Malaysia Marine & Heavy Engineering (MMHE)

Postby winston » Thu Mar 23, 2023 10:19 am

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Malaysia Marine and Heavy Engineering (MMHE MK)
Sustainability In Future Profit Generation


MMHE is busy executing the contracts from >RM7.5b orderbook (an all-time high), while
still having the appetite to secure new projects.

Aside from offshore wind jobs, MMHE is gaining traction internationally, and may bid for a sizeable Qatari O&G contract.

The marine segment is starting to service sophisticated O&G vessels and its first FSRU
project, although our forecasts remain conservative, as it may also benefit from green
retrofit demand.

Maintain BUY and target price of RM0.80.

Source: UOBKH

https://research.uobkayhian.com/content ... d70c055e74
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