Velesto Energy (former UMW Oil & Gas)

[winston]

Velesto Energy (VEB MK)
Solid Trajectory For QOQ Earnings Increase

The latest rig schedule updates confirm that VEB will enjoy high utilisation of 90% throughout 2023 (save for a slight utilisation weakness in 3Q23).

With this, we expect qoq earnings to improve in tandem with higher average rig rates, as long as VEB maintains solid execution and cost control.

The multi-year rig upcycle will give VEB another chance to renegotiate for better rates.

However, risk-reward has been priced in relative to global peers’ valuations.

Maintain HOLD. Target price: RM0.21.

Source: UOBKH

https://research.uobkayhian.com/content ... 7c85f11496

[winston]

not vested

Analysts stay cautious over Velesto's 'inflated' share price

Source: The Star

https://www.thestar.com.my/business/bus ... hare-price

[winston]

4Q23: Strongest quarter in 9 years, with more to come!
Major beat in 4Q23. Stay BUY, TP MYR0.35 (Top Pick)

4Q23 results was a major beat relative to our results preview on 15 Jan 2024 (link).

We raise FY24-25E earnings by 3% p.a. after updating full-year FY23 figures.

Our FY24-26E assumptions are:
i) utilisation rates of 82%/85%/83%; and
ii) blended average DCRs of USD112k/130k/132k respectively.

Post-adjustments, we maintain our BUY call with a marginally higher TP of MYR0.35 (MYR0.34 previously) based on 14x PER on mid-FY25E EPS (unchanged).

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/367083.pdf