Velesto Energy (former UMW Oil & Gas)

Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Mon Apr 22, 2019 9:43 am

not vested

Substantial progress in orderbook build-up

Velesto has increased its contracted utilisation rate for FY19F to 66%, up from 38% just two months ago in Feb 2019, closing in on our 80% forecast.

With greater visibility, lower business risk, and Petronas’ apparent resolve to increase drilling activity in Malaysia, we reduce our equity beta from 1.5 to 1.

Cost of equity is lowered from 13% to 10.6%, which raises the DCF-based target price to 32 sen. Maintain Add as we expect even more contract wins.


Source: CIMB

https://brokingrfs.cimb.com/nZBPBCC-yw6 ... 6AyMg2.pdf
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Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Mon Apr 22, 2019 9:43 am

not vested

Substantial progress in orderbook build-up

Velesto has increased its contracted utilisation rate for FY19F to 66%, up from 38% just two months ago in Feb 2019, closing in on our 80% forecast.

With greater visibility, lower business risk, and Petronas’ apparent resolve to increase drilling activity in Malaysia, we reduce our equity beta from 1.5 to 1.

Cost of equity is lowered from 13% to 10.6%, which raises the DCF-based target price to 32 sen. Maintain Add as we expect even more contract wins.


Source: CIMB

https://brokingrfs.cimb.com/nZBPBCC-yw6 ... 6AyMg2.pdf
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
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Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Thu May 16, 2019 10:33 am

not vested

Velesto Energy (VEB MK)
Capturing A Rising Dragon


VEB is the best proxy to local upstream capex growth in 2019, given a surge in Petronas’ local jack-up rig demand.

We expect more contract newsflow to support uptick in 2H19 utilisation (to 90%) and average rates.

Utilisation recovery at >71% is key to sustaining VEB at profitable levels.

Our valuation is based on EV/EBITDA, believing VEB’s fundamentals will fluctuate along with quarterly EBITDA changes.

Initiate coverage with BUY and target price of RM0.35, pegged to 12x 2H19F annualised
EV/EBITDA.

Source: UOBKH

https://research.uobkayhian.com/content ... fc03d79ad6
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Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Thu May 23, 2019 8:02 am

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2Q Turnaround?

Velesto posted a net loss of RM22.22mil in its first quarter ended March 31, compared with a net profit of RM5.02mil in the previous corresponding period, mainly due to a net foreign-exchange gain of RM18.2mil a year earlier that had resulted from the early settlement of revolving credit.

Nevertheless, an analyst is optimistic that the company’s fortunes could turn around in the second quarter.

Operating seven JU rigs in Malaysian waters, UOB Kay Hian in a recent report said Velesto is in a sweet spot, benefitting from a surge in Petronas’ yearly JU rig requirement from six to 10 and 16 to 19 for 2019 to 2021.

The only other local competitor is troubled entity Perisai Petroleum Teknologi Bhd, which owns one JU rig, the research house said, adding that many new contracts have been awarded to foreign rigs and Velesto has secured six to seven year-to-date, including four long-term ones.

Source: The Star

https://www.thestar.com.my/business/bus ... R5JwqvY.99
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Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Thu May 23, 2019 8:02 am

not vested

2Q Turnaround?

Velesto posted a net loss of RM22.22mil in its first quarter ended March 31, compared with a net profit of RM5.02mil in the previous corresponding period, mainly due to a net foreign-exchange gain of RM18.2mil a year earlier that had resulted from the early settlement of revolving credit.

Nevertheless, an analyst is optimistic that the company’s fortunes could turn around in the second quarter.

Operating seven JU rigs in Malaysian waters, UOB Kay Hian in a recent report said Velesto is in a sweet spot, benefitting from a surge in Petronas’ yearly JU rig requirement from six to 10 and 16 to 19 for 2019 to 2021.

The only other local competitor is troubled entity Perisai Petroleum Teknologi Bhd, which owns one JU rig, the research house said, adding that many new contracts have been awarded to foreign rigs and Velesto has secured six to seven year-to-date, including four long-term ones.

Source: The Star

https://www.thestar.com.my/business/bus ... R5JwqvY.99
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
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Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Thu May 23, 2019 9:23 am

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Poor 1Q but outlook for 2H markedly better

We had expected VEB to deliver a 1Q19 core net loss on low utilisation rates but the RM23m loss was greater than expected on higher operating costs.

As a result, we maintain Hold but cut our DCF-based target price to 30 sen and lower our FY19F core net profit forecast by 7%.

VEB’s share price should hold up because the 2H19F outlook is much better, with jack-up utilisation rates estimated at 95% vs. 71% in 1H19F

Source: CIMB

https://brokingrfs.cimb.com/9mfPd1fhP34 ... K88uQ2.pdf
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Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Thu May 23, 2019 10:20 am

not vested

Velesto Energy (VEB MK)

1Q19: Expected Loss On Low Utilisation, But Set To Pick Up

A core loss was expected for 1Q19, despite higher costs and taxes. More importantly, EBITDA is on track.

We expect utilisation to increase qoq from 66% to >70% in 2Q19, and a strong 2H on improving utilisation, rates and workover revenues.

We retain profit forecasts, which may be subject to a downward bias.

There is opportunity to collect on weakness as fundamentals are focused on an EBITDA recovery.

Maintain BUY with target price of RM0.35 (annualised 12x 2H19 EV/EBITDA).

Source: UOBKH

https://research.uobkayhian.com/content ... 7a1d33df25
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Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Tue Sep 17, 2019 9:19 am

not vested

Sep 3, 2019

First Profitable 2Q since 2015

Currently, there are 20 rigs available in Malaysia, whereby 14 are contracted (utilization: 70%). Out of the 20 available rigs, merely 8 comprises locally-owned rigs, of which 7 belongs to VEB.

Our target price (TP) for VEB is raised to RM0.38 (previous: RM0.34) based on unchanged 13x CY20 EV/EBITDA.

The increase in TP is due to higher FY20 EBITDA generation.


Source: TA Securities
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Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Tue Nov 12, 2019 9:28 am

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Market heats up, rates on upward trajectory

We have reviewed our assumptions for Velesto following rising spot daily charter rates and Velesto’s success in securing a new high-rate contract.

Maintain Add with higher FY21F forecasts, and raise DCF-based target price to 47 sen on the back of higher utilisation and charter-rate assumptions.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 9094D3A8B4
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
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winston
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Re: Velesto Energy (former UMW Oil & Gas)

Postby winston » Tue Nov 12, 2019 9:28 am

not vested

Market heats up, rates on upward trajectory

We have reviewed our assumptions for Velesto following rising spot daily charter rates and Velesto’s success in securing a new high-rate contract.

Maintain Add with higher FY21F forecasts, and raise DCF-based target price to 47 sen on the back of higher utilisation and charter-rate assumptions.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 9094D3A8B4
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
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Posts: 105002
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