KUALA LUMPUR: Maybank Investment Bank Research said Wah Seong Corp Bhd's second from last quarter monetary outcomes finished Sept 30 came in beneath its appraisals/agreement, on higher partners' misfortunes.
The exploration house said descending income corrections aside, the venture edge to Wah Seong was the execution of its Nord Stream 2 (NS2) contract.
It included that Wah valuations was economical. It has kept up a "purchase" approach Wah Seong with an objective cost of RM1.08, in light of 10x PER, as we move over valuations to 2018.
Maybank said Wah Seong's 3Q16 center net loss of RM15mil enlarged nine months to Sept 30 center net misfortune to RM29mil, representing 78% of its underlying money related year misfortune appraise.
Its 26.9%-claimed Petra Energy was the fundamental offender, making up half of the misfortunes in second from last quarter.
"This was trailed by proceeded with misfortunes at its 49%-claimed ranch equip in Congo and start-up misfortunes of its 49%-pipe-covering JVs in China, GoM and Canada," Maybank said, including that these were incompletely refuted by benefits at its 49%-possessed Alam-PE (OSV operations).
"We have raised Wah Seong's FY16 net misfortune gauge by 20% and brought down FY17/18 net benefit conjectures by 8%/6% separately, essentially to mirror the lower partners benefits.
"We don't preclude a monstrous kitchen sinking exercise by 4Q16 being debilitation for its 49%-possessed manor operations in Congo and maturing channel fabricating offices in Seberang Prai, which have conveying estimations of RM90mil and RM19mil; 10% of its shareholders' assets," Maybank said.
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