Bumi Armada Initiation

Phillip Capital Sdn Bhd
RESEARCH

https://www.bursamarketplace.com/mkt/tools/research/ch=research&pg=research&ac=2124786&bb=2170172

KUALA LUMPUR (March 19): Phillip Capital has initiated coverage on Bumi Armada Bhd (BAB) with a “buy” rating at 56 sen with a target price of 80 sen and said BAB is well-positioned to capitalise on the growing demand for floating production storage and offloading (FPSO), supported by its stronger balance sheet amid the increasing global oil and gas capital expenditure (capex) spending.

In a note on Tuesday, the research house said it expects 2024 to deliver a record-high profit driven by the full contribution of FPSO Sterling V and the normalisation of FPSO Kraken operations.

“We see multiple re-rating catalysts on the horizon, including 1) FPSO Sterling V securing final acceptance and recognising the full bareboat charter (BBC) rates, 2) FPSO TGT-1 securing 7-year charter extension, 3) both pipelay vessels securing new contracts and 4) potential new FPSO contracts win.

“Key risks include any unforeseen operational delays in existing FPSOs and securing final acceptance for Sterling V, and sharp global oil price decline affecting the global capex spending,” it said.

Expecting record high core net profit in FY24E With Kraken back to status quo operations and our expectations of BBC recognition for its 30%-owned Armada Sterling V FPSO beginning Apr 2024, we forecast a record-high core net profit of MYR853m in FY24E

https://klse1.i3investor.com/servlets/staticfile/533201.jsp

Bumi Armada- Potential Sale of Karapan Armada Sterling III

Based on a capex of US$500mil, a project IRR of 13.5%, 49%-
associate stake and a WACC of 6%, we estimate the net
present value contribution for KAS III attributable to Bumi
Armada at RM681mil. Against our estimated book value of
RM602mil for the vessel, we expect the group to record a oneoff disposal gain of RM79mil- 9% of FY24F net profit

Aminvest - Oil & Gas
Robust earnings growth from elevated oil prices against the backdrop of prolonged supply disruptions and past underinvestment. Companies with direct exposure to upstream production and FPSO subsector will be i n pole position to ride on
the tailwind of bouyant oil prices.

275mil fine coming soon

-------------------------------------------------------------------

KUALA LUMPUR (2023 Nov 3): Indonesia's highest court has dismissed the appeal by TDM Bhd’s subsidiary against the republic's Ministry of Environment and Forestry in relation to a fire incident in 2019 at its land in West Kalimantan province.

The plantation group told Bursa Malaysia on Friday that the Indonesian Supreme Court has upheld the decision by the Pontianak High Court, which ordered the subsidiary — PT Rafi Kamajaya Abadi (PTRKA) — to pay compensation of 188.98 billion rupiah (RM56.68 million) for environmental loss.

PTRKA also will have to fork out 731.04 billion rupiah (RM219.25 million) to rehabilitate the environment in the affected area of 2,560 hectares and to reactivate the affected ecology system.

In total, the Terengganu state-controlled group is required to pay RM275.93 million, a figure that nearly matches its entire market capitalization of RM293 million.

Armada Sterling V achieve significant milestone of first off take on 27th feb 2024 and the offtake tanker flagged off on 2 mar 2024

For FY24, we expect earnings to normalize on lower subsidy received from the Malaysian Government. Note that the subsidy for chicken has been discontinued in November 2023

On a positive note, its Armada Sterling V 98/2 has achieved first oil in January 2024 and is looking forward to achieving first gas by April 2024

Separately, BAB said at the analyst briefing that it already received credit
committee approvals from several banks to refinance the RM1.5bn sukuk
borrowings which will be maturing on 4 Sep 2024F.

BAB emphasised at the post-results analyst briefing that the contracted cashflows
for the FPSO Kraken remain unchanged.

Trading in BAB shares is likely to be dominated by retail flows, in our view,
and the average retail investor may find it difficult to understand the rationale for such an impairment; this caused BAB’s shares to plunge 11% yesterday after the lunchtime release of its FY23 results.

In our view, this is an opportunity for investors to accumulate BAB shares for a potential short-term rebound.

4Q23 core net profit of RM313m

CIMB raise target price to RM0.75
Selldown offers opportunity to accumulate

this is the first time Gary talk about enhance shareholder value & possible corporate activities

for bumi, always expect the unexpected

this is the fact : Impairment means bringing the depreciation costs forward earlier hence future depreciation costs are going to be lower

Sterling II end Mar24

now the question will be, what about for the rest of FPSO which firm charter ending soon

and yet greedy Gary still not willing pay out any single cent for dividend

Does this mean bonus share, dividend in near term?

Moving forward, we continue to explore ways to enhance shareholder value
including new projects and possible corporate activities.”

historical high operating profit RM386,291,000 before impairment.
Let's wait for next quarter to fully reflect armada potential along with sterling V contribution

last chance to buy below RM0.60
No more discount After 12.30pm

pre market action is boosted by velesto suprise earning and dividend

good news, 3 continuos yoy profit drop 42%.

disposal gain 20mil, core earning 12mil.
PE 16.45 which is more expensive than uchitec

Armada just follow the trend of oil sector, there is nothing related to new contract or good Q4

KWSP,EPF,ABRDN are continiously dumping the stocks

KUMPULAN WANG PERSARAAN (DIPERBADANKAN) 15-Feb-2024 Disposed 450,000 0.000 View Detail
EMPLOYEES PROVIDENT FUND BOARD 14-Feb-2024 Disposed 562,400 0.000 View Detail
EMPLOYEES PROVIDENT FUND BOARD 14-Feb-2024 Disposed 300,000 0.000 View Detail
ABRDN HOLDINGS LIMITED 14-Feb-2024 Disposed 1,877,100 0.000 View Detail
ABRDN MALAYSIA SDN BHD 14-Feb-2024 Disposed 1,877,100 0.000 View Detail
ABRDN PLC 14-Feb-2024 Disposed 1,877,100 0.000 View Detail
KUMPULAN WANG PERSARAAN (DIPERBADANKAN) 14-Feb-2024 Disposed 735,800 0.000 View Detail
EMPLOYEES PROVIDENT FUND BOARD 13-Feb-2024 Disposed 1,262,300 0.000 View Detail
EMPLOYEES PROVIDENT FUND BOARD 13-Feb-2024 Disposed 600,000 0.000 View Detail
EMPLOYEES PROVIDENT FUND BOARD 05-Feb-2024 Disposed 400,000 0.000 View Detail
EMPLOYEES PROVIDENT FUND BOARD 05-Feb-2024 Disposed 300,000 0.000 View Detail
KUMPULAN WANG PERSARAAN (DIPERBADANKAN) 05-Feb-2024 Disposed 622,900 0.000 View Detail

(SINGAPORE) ABS has awarded Approval in Principle to Bumi Armada’s pioneering
design for a floating carbon storage and injection unit (FCSIU).


Bumi Armada’s FCSIU concept is a floating terminal capable of storing and injecting liquified carbon dioxide (LCO2) into depleted oil and gas fields or aquifers. This novel concept incorporates the ability to accept LCO2 deliveries in an offshore setting, the flexibility to manage LCO2 at low or medium pressure, the provision of LCO2 buffer storage and the preparation of LCO2 for sequestration - permanent storage of CO2 deep beneath the seabed.

KUMPULAN WANG PERSARAAN (DIPERBADANKAN) 15-Feb-24 Disposed 450,000
ABRDN HOLDINGS LIMITED 14-Feb-24 Disposed 1,877,100
ABRDN MALAYSIA SDN BHD 14-Feb-24 Disposed 1,877,100
ABRDN PLC 14-Feb-24 Disposed 1,877,100
KUMPULAN WANG PERSARAAN (DIPERBADANKAN) 14-Feb-24 Disposed 735,800
EMPLOYEES PROVIDENT FUND BOARD 13-Feb-24 Disposed 1,262,300
EMPLOYEES PROVIDENT FUND BOARD 13-Feb-24 Disposed 600,000
EMPLOYEES PROVIDENT FUND BOARD 5-Feb-24 Disposed 400,000
EMPLOYEES PROVIDENT FUND BOARD 5-Feb-24 Disposed 300,000
KUMPULAN WANG PERSARAAN (DIPERBADANKAN) 5-Feb-24 Disposed 622,900

SKP Resources may face prolonged weakness in order visibility, says CGS-CIMB

https://www.klsescreener.com/v2/news/view/1277813/skp-resources-may-face-prolonged-weakness-in-order-visibility-says-cgs-cimb

Warren Buffett-backed Occidental Petroleum is predicting an oil supply shortage by 2025 due to global failure to replace crude reserves at a fast enough pace.

https://oilprice.com/Latest-Energy-News/World-News/Buffett-Backed-Occidental-CEO-Says-Oil-Shortage-by-2025.html

https://cdn1.i3investor.com/my/files/st88k/6963_VS/pt/AMINVEST/6963_VS_AMINVEST_2024-01-18_HOLD_0.67_VSIndustryExpectweakersalesordersin2QFY24_1397052842.pdf

Perception or fact?
read Analysis Brief from VS

Why SKPRES drop more than VS?

Skpres revenue from dyson = ~80%
VS revenue from dyson = ~30%

Coming few quarters result will badly hit due to Customer X's orders sharply declined In 4QCY23 (Oct-Dec).

Management expects the weakness to remain in the near term

https://www.linkedin.com/posts/oilandnaturalgascorporation_india-ongc-indiaenergyweek2024-activity-7157227732655898624-d4ud?utm_source=share&utm_medium=member_android

Embark on #India's journey to economic prosperity!

#ONGC's flagship KG-DWN-98/2 Block sails confidently into the Final phase, poised to achieve full oil and gas production by mid-2024.

A monumental leap towards a resilient and self-sustaining energy sector.

or Mumbai JV started

@niki, new tender for FSRU?

Post Briefting Result from VS.

Key customers updates
In 4QCY23 (Oct-Dec), Customer X's orders sharply declined, impacting VSI's
1HFY24 (FYE Jul) performance. Management expects the weakness to
remain in the near term

A Rising Tide Floats All Boats

FPSO clients are increasingly favouring asset ownership over
leasing due to limited contractor availability and financing
challenges. Hence, the barrier of entry to the FPSO market has
also risen for potential new entrants. The tight FPSO market
remains favorable for existing players. We maintain our forecasts,
TP of RM3.39 and OUTPERFORM call.

We came away from meeting with Energy Maritime Associates (EMA)
organised by YINSON feeling more reassured about the FPSO market
outlook. The key takeaways are as follows:

1. A trend is emerging where clients (end-users of FPSO assets) opt
to own the FPSOs, securing contractors' services solely for the
Engineering, Procurement, and Construction (EPC) phase of the
project. In both 2022 and 2023, a total of 11 contracts followed this
structure, with clients taking ownership of the assets. This shift may
be attributed to a shortage of capacity among FPSO contractors
and increased challenges in obtaining debt financing from banks,
likely influenced by Environmental, Social, and Governance (ESG)
considerations.

2. Traditional banks are increasingly reluctant to provide debt
financing to FPSO contractors due to growing (ESG) concerns.
This reluctance raises entry barriers for new players aiming to enter
the FPSO market, given the substantial capex required for such
projects. Established FPSO players with proven track records are
exploring alternative financing avenues, such as project bond
instruments, private equity funding, and prepayments by clients on
their leases and this has led to limited FPSO players bidding for
new FPSO jobs unless the IRR is attractive enough.

3. The FPSO market is anticipated to remain tight in 2024, as
indicated by EMA's survey, revealing record-high industry
confidence. About 93% of clients express confidence in their
companies' outlook, a notable increase in 2024 from 77% in 2023.
Easing concerns of inflation in 2024 suggest that the prices of
spare parts and labour will not experience the same rapid
increase seen in 2023. Consequently, FPSO contract awards may
also see a YoY increase in 2024, surpassing the six awards
recorded in 2023.

EPF start selling after their briefing meeting

Post Briefting Result from VS.

Key customers updates
In 4QCY23 (Oct-Dec), Customer X's orders sharply declined, impacting VSI's
1HFY24 (FYE Jul) performance. Management expects the weakness to
remain in the near term

After an analyst briefing yesterday, we reduced FY24F-26F
earnings by 12%/7%/9% to account for weaker sales orders
from VSI’s key customers and lower profit margin assumptions
to reflect lower economies of scale.

 Specifically, VSI’s 1HFY24F revenue will be impacted mainly by
VSI’s key customer, Customer X (which account for 25%-30%
of VSI’s FY24F revenue), as a result of its high inventory levels
coupled with current weak consumer sentiments, especially in
Western regions due to elevated inflation and interest rates.

Bumi Armada Berhad refers to its previous disclosures regarding its 30% associated company, Armada 98/2 Pte Ltd and wishes to announce that the Armada Sterling V FPSO has successfully achieved “First Oil” production on 7 January 2024. Following this, the Armada Sterling V FPSO will commence the necessary acceptance tests to achieve Final Acceptance, which is required for the vessel charter to commence. We will make further announcements regarding the matter as appropriate.



The announcement is dated 10 January 2024.

yea tothemoon, it need another 2 quarters for dividend to come.

Trend in past 9 quarters
-268,748 -446,514 -565,284 -766,294 -976,975 -1,126,698 -1,312,948 -1,498,705 -1,616,706

stay tune

ONGC nears contract award on flagship offshore redevelopment project

https://www.upstreamonline.com/field-development/ongc-nears-contract-award-on-flagship-offshore-redevelopment-project/2-1-1577644