Please read this report via the link below.
https://www.oaklandspath.com/the-fpso-industry-and-top-tier-lessor-and-operator-yinson

I read this report at least 10 times so that I can understand the high debt of Yinson.

All the present 11 billion debt will be disappeared after FY2025 (January 2025).
1.) FPSO Anna Nery achieved financial acceptance in May-23, all the debt of this FPSO Anna Nery will be taken over by the oil company.
2.) FPSO Atlanta and FPSO Maria Quiteria will be delivered in the middle of next year (2024), all the debts of these FPSOs will be taken over by the oil company.
3.) FPSO Agogo will be delivered by Feb-26, all the debt of this FPSO will be taken over by the oil company in Feb-26. Please note that this oil company has paid Yinson a payment in advanced of USD500 million. Hence there is no debt on this FPSO.

The actual operating cash flow should reach over RM3bn in calendar year 2026 and is sustainable for at least another 15 years based on the firm period alone. This compared to a market cap of RM7.4bn today with total net debt of RM11bn.

The debt could be fully paid within a few years if the company does not take on a new project. The cash leftover for shareholders may equal 5 to 8 times of today’s market cap i.e. may equal 59.2 billion in 15 years time.

Please read the aforesaid article again and again, all your questions will be resolved.
The aforesaid article written by Oaklands Path on Yinson is very good, you will understand the fundamental of Yinson very well.
Thank you.

Posted by James_Bond > 2 days ago | Report Abuse
High borrowing will kill Yinson! It kills Evergrande Group successfully! Next, will it be Yinson, high borrowing company?
--------------------
@James_Bond,

Oaklands Path is a broker authorised by the Hong Kong Stock Exchange.

Please read this report via the link below.
https://www.oaklandspath.com/the-fpso-industry-and-top-tier-lessor-and-operator-yinson
This article would not have been possible without the sharing of Raymond Yap of CGSCIMB and Keat Seng of KSC.
Note :
FPSO Anna Nery achieved financial acceptance in May-23 and began generating lease income.
Currently, it still has 3 more FPSOs under construction.
FPSO Atlanta and FPSO Maria Quiteria will be delivered next year and FPSO Agogo will be delivered by Feb-26.
The present debt incurred by the aforesaid 3 FPSO vessels.
The high debt will disappear by 2026 if the company does not take on new project.
Example.
FPSO Anna Nery achieved financial acceptance in May-23.
The loan is no longer belong to Yinson and the loan is transferred to the owner of the oil company once FPSO Anna Nery is accepted for full operations.
Likewise, the loans of 3 FPSO presently under construction will disappear in 2024 and 2026 once the FPSO is accepted for full operation and subjected to final acceptance by the oil company.

The actual operating cash flow should reach over RM3bn in calendar year 2026 and is sustainable for at least another 15 years based on the firm period alone. This compared to a market cap of RM7.4bn today with total net debt of RM11bn.

The debt could be fully paid within a few years if the company does not take on a new project. The cash leftover for shareholders may equal 5 to 8 times of today’s market cap i.e. may equal 59.2 billion in 15 years time.

Please read the aforesaid article again and again, all your questions will be resolved.
The aforesaid article written by Oaklands Path on Yinson is very good, you will understand the fundamental of Yinson very well.
Thank you.

Hope that the share price of YTLPower can close at 2.01 and above today.
Good luck.
Thank you.

Posted by rr88 > 22 hours ago | Report Abuse
Pump chit at technical rebound top.
You dont lari, you kena.
Next stop 0.69
----------------------------
I bought 100 lots (100K) at 0.775 on 4/10/2023 and sold at 0.88 today.
The share price of UEMS did not drop to 0.69 as frightened by this day trader.
This day trader told everyone to sell in this forum almost everyday, can we invest in this manner ?
Is his strategy right ?
This day trader is wrong all the time in this UEMS forum. Please check all his postings here.
Should we still want to listen to him ?
Your choice.
Thank you.
---------------------------
I sold 100k shares of UEMS at 0.88 previously.
I decided to buy back 100k shares of UEM at 0.74 today.
The strong support is at 0.735.
I believe the uptrending trend of UEMS is still intact.
The new target price recommended by RHBBank is 1.18.
There is a lot of margin of safety on this stock.
I have made 5 round profits so far on this stock.
Hope to make 6th round profit on this stock again.
I want to test my TA skill on this stock.
Good luck.
Thank you.

Please read the link below.
https://theedgemalaysia.com/node/686111

Winners from Malaysia's 2024 spending plan.

New energy players

Malaysia will continue to expand its electric vehicle charging infrastructure and encourage EV adoption through rebates, which will help players such as Yinson Holdings Bhd. It will also increase the installation of solar panels, including at government premises, in partnership with Tenaga Nasional Bhd.

Thank you.

The main income from Yinson is from FPSO charters service, the rate is fixed by the agreement.
Crude oil price has no bearing on her profit.
The cost of production of oil for the oil company using FPSO service is < USD10 per BBL.
Hence this FPSO charters service has a very good future, no oil company will terminate FPSO contract due to low cost of production.
There is more demand than supply in the present market.
There are 13 FPSO projects to be awarded every year, very few players interested to take the job because there is no capacity to build FPSO vessel.
There are only 8 proven and reliable players in the world.
The capacity of Yinson is only 1 FPSO vessel per year.
Please note that Yinson is the best or preferred bidder for FPSO project in the world.
Thank you.

Closed at 2.03 today is good enough for the technical chart of YTLPower to be bullish.
The share price closed above 2.01 which is the 20-day EMA line.
Hope to see a bull market after this 2024 budget day.
Hope to see a year end rally in 2023.
We haven't seen a bull market in KLSE for a long time.

Good luck.
Thank you.

FBMKLCI
FBMEMAS
Financial Serv
Utilities Index
All aforesaid indexes are bullish and cross above 200-day SMA.
YTLPower is classified under an utilities stock.
The technical chart of YTLPower is also bullish and above the 200-day SMA.

The above indexes indicate to me, KLSE will be bullish after the 2024 budget.
Hope to see a year end rally in 2023.
We haven't seen a bull market in KLSE for a long time.

Good luck.
Thank you.

All 3 major FPSO projects will be in full operations starting from Q1 2026 onward. I know that the present debt of 11 billion is high, please note that once the FPSO vessel is ready and accepted by the oil company, the debt will be transferred to the oil company.

If Yinson does not take up any project after Q1 2026, the debt will be reduced to almost zero.
The free cash flow generation should be more than RM3bn each year from FY Jan-27 onwards. This level of free cash flow generation should be sustainable for at least 15 years based on the firm lease period.

Thank you.

FPSO Anna Nery. Brazil. 75% stake in 2023, 66.5% stake in 2024.
https://www.theedgemarkets.com/article/yinson-rises-17-after-landing-fpso-contracts-worth-us52b-brazil
https://www.oedigital.com/news/497166-naming-ceremony-held-for-yinson-s-anna-nery-fpso#:~:text=The%20estimated%20aggregate%20value%20of,date%20of%20the%20final%20acceptance.
Contract value = USD 5.4 billion. 25 years firm.
Start operation in early 2023.
Annual (charter rate) revenue = USD 5400 million/25*75% = USD 162.00 million = RM 745.20 million (1 USD = RM 4.60)

3 FPSO vessels of Yinson under construction
1.) FPSO Maria Quitéria. Brazil. 100% stake.
https://www.theedgemarkets.com/article/yinson-lands-fpso-contracts-worth-us52-billion-brazil
Contract value = USD 5.2 billion. 22.5 years firm.
Start operation in mid-2024.
Annual (charter rate) revenue = USD 5200 million/22.5 = USD 231.11 million = RM 1.063.10 billion (1 USD = RM 4.60)

2.) FPSO Atlanta. Brazil. 100% stake.
https://www.oedigital.com/news/494478-malaysia-s-yinson-brazil-s-enauta-pen-firm-contracts-for-atlanta-field-fpso
Contract value = USD 1.9 billion. 15 years firm and with option to extend 5 years.
Start operation in mid-2024.
Annual (charter rate) revenue = USD 1900 million/15 = USD 126.67 million = RM 582.68 million (1 USD = RM 4.60)

3.) FPSO Agogo. Angola. 100% stake.
https://www.theedgemarkets.com/node/657117
https://klse.i3investor.com/web/announcement/detail/1757017
Contract value = USD 5.3 billion (Inclusive 15 years + optional 5 years extension). 15 years firm and with extension 5 years.
Start operation in the fourth quarter of 2025.
Annual (charter rate) revenue = USD 5300 million/20 = USD 265.00 million = RM 1.219 billion (1 USD = RM 4.60)

You need cash to construct these 3 big FPSO vessels.
Please note that payback is only 3 years.
No oil company will terminate FPSO contract because the production cost of FPSO is < USD10 BBL.
Oil company is laughing all the way to the bank in view of high crude oil price.
Oil company wants fast delivery on the FPSO vessels.
The oil company of FPSO Agogo vessel paid USD 500 million upfront and in advanced to Yinson because this oil company wants a fast delivery on the vessel.

Thank you.

The following events will enhance the future share price of YTLPower.
1. YTLPower might be added to FBMKLCI component stocks in December's review. Presently, YTLPower ranks no 23-26.
2. Good Q1 Sep 2024 result releases in November 2023. I believe the result is definitely better than Q1 Sep 2023 result. All analysts will upgrade the target price of YTLPower.
3. Tan Sri Francis Yeoh promised to give out a dividend of 15 sen for FY2024.
4. The target price set by HLIB in 2023 is 2.90, I believe it is achievable.
5. I believe foreign funds are net buyer on this stock. Very good news.
6. RE Power and utilities sectors are growth sectors currently, right business model.

Good luck to all investors here.
Thank you.

The share price of YTLpower breaks 2.01, 2.06, 2.07 and reach the high at 2.09 today is a good sign now.
The share price moving up slowly and steadily.
It means the trend is in an uptrend.
Looking forward to break 2.24 soon.
Good luck.
Thank you.

The main objective of this forum is to share information and to make money together.
dragon328 has showed a very good example to us, I really appreciate his effort and good reports.
This forum is definitely not to be used to attack any person.

Using TA alone without using FA will not work well in KLSE.
A stock without good fundamental, the share price will not move up north to break new high.
The value of the share is supported by good earning and growth, forget about the stock if the earning is not good and there is no growth in earning in the future.

A stock is very good in fundamental, the share price will drop to new low, I think we should not believe this person who argue in this manner.
Definitely he is a loser in the stock market and I believe this person lost all his wealth in the stock market.
Invest in good growth stock will make you a winner in KLSE.
Thank you.

Under finance lease accounting, the investment in CAPEX to construct the FPSO is recognized as a contract asset on the balance sheet. The change in contract asset must be included in reported cash flow from operations. In reality, this change in contract asset represents CAPEX to build new FPSOs and should not be considered as operating cash flow. The actual operating cash generated for FY Jan23 should be RM1.36 bn.
Thank you.

The future prospect of Yinson is very bright due to the huge order book secured now.

Moreover, Yinson has been awarded the ‘Industry Excellence Award’ under the energy sector at MSWG-ASEAN Corporate Governance Award 2021, in recognition of the Group’s exemplary corporate governance disclosure and practices amongst Malaysian public listed companies.
I believe the management of Yinson can be trusted and I am sure Yinson will make it to be a component stock of FBMKLCI index in the next 5 years.
Thank you.

Posted by dragon328 > 43 minutes ago | Report Abuse

@cgtan2020, I also saw that 11m shares transacted at RM2.02 at 4.50pm just now.

So we have seen large transactions done at RM1.88, then at RM2.08 and today at RM2.02, averaged at about RM2.00. Looks like funds are getting ready for next leg up.
----------------------
When a big transaction is done through the screen terminal, the likely buyer is the foreign fund because the foreign fund wants transparency in the above transaction.
Local fund may consider to do a married deal (off market transaction).
Good luck.
Thank you.

Do not worry, the technical chart of YTLPower is bullish now.
1.) Parabolic SAR shows buy signal.
2.) Stochastic shows buy signal.
3.) Force Index shows buy signal.
4.) The share price of YTLPower is higher than 20-day EMA. A bullish sign.
Good luck.
Thank you.

Post removed.Why?

Sorry, rr88 lost 16 million in KLSE previously, he said today.
He quoted 12.5 million previously.

Post removed.Why?

Posted by rr88 > 22 hours ago | Report Abuse
Pump chit at technical rebound top.
You dont lari, you kena.
Next stop 0.69
----------------------------
I bought 100 lots (100K) at 0.775 on 4/10/2023 and sold at 0.88 today.
The share price of UEMS did not drop to 0.69 as frightened by this day trader.
This day trader told everyone to sell in this forum almost everyday, can we invest in this manner ?
Is his strategy right ?
This day trader is wrong all the time in this UEMS forum. Please check all his postings here.
Should we still want to listen to him ?
Your choice.
Thank you.

Please read this link.
https://researchnews.affinhwang.com/Research/DailyReports/20231011/Affin%20Hwang%2020231011%20ChartTrek_YINSON_UZMA.pdf

Thank you.

Dear kwteoh,
Noted. Thank you for your good words about me.
I appreciate it.
Thank you.

I admire nikicheong, I know that he is better than me on Armada.
He is very knowledgeable and well respect in this forum.
I like to read nikicheong's posting, I appreciate his contribution here.
Moreover, I also learn a lot of knowledge from him.
This forum is to share information, not to attack anyone here.
Thank you.

Hope the share price of YTLPower can cross 2.01 and also 2.05 convincingly today.
I prefer it can close at least at 2.06 today.
Good luck.
Thank you.

If you use moving average method, close above 20-day EMA at 2.01 is considered as a bullish signal.
I believe the share price will cross 2.01 tomorrow.
Good luck.
Thank you.

To me, the last 3 candles look like a "Morning Star" chart pattern.
If the share price of YTLPower can close above 2.05 tomorrow, then the trend reversal is confirmed.
The correction is over and the uptrend started.
Good luck.
Thank you.

Post removed.Why?

FPSO contract will be in great demand because the cost of production of oil is less than USD10 per BBL.
The high price of crude oil will also benefit Yinson because Yinson is allowed to claim bonus on the crude oil.
Thank you.

This syndicate also can read technical chart very well.
Close at 2.01 and above is a good sign.
Hope the syndicate places a big buy order at 2.01.
Good hope and good luck.
Thank you.

The following events will enhance the share price of YTLPower.
1. Listed in FTSE Asia-Pacific index on 18/9/2023 - Completed.
2. YTLPower might be added to FBMKLCI component stocks in December's review. Presently, YTLPower ranks no 26.
3. Good Q1 Sep 2024 result releases in November 2023. I believe the result is definitely better than Q1 Sep 2023 result. All analysts will upgrade the target price of YTLPower.
4. Tan Sri Francis Yeoh promised to give out a dividend of 15 sen for FY2024.
5. The target price set by HLIB in 2023 is 2.90, I believe it is achievable.

Good luck to all investors here.
Thank you.

Posted by klee > 2 hours ago | Report Abuse
Jeri likes to make a fool of himself.Otb offers great guidance here.As for jeri,day day play copy paste.Worst than kiddo lolz.Cant contribute then shaddap.
--------------------
Do not waste your time on this bankrupt.
If a person is smart, he will not resort to posting all outdated articles and irrelevant articles here.
If Jerichomy is smart, he will not lose in the stock market until bankrupt.
Did you ever read any recommendation report from Jerichomy ? Ans is no.
He does not know what is a stock market, what is a growth stock.
He knew best is copy and paste all irrelevant article in this forum.
Please ignore him and let him go back to his Tanjung Rambutan hospital to rest.
I have given up hope on this person.
Thank you.

Posted by HuatRex1314 > 53 minutes ago | Report Abuse
It could be a technical rebound. If today close above 2.01 then uptrend intact.
------------------------
Yes. You are right.
If can close at 2.01 and above, the uptrend has started.
2.01 happens to be 20-day EMA line.
Thank you.

The strong support at 1.88 is still hold.
Hope that the worst is over in this correction.
Good luck to all investors here.
Thank you.

FPSO contract will be in great demand because the cost of production of oil is less than USD10 per BBL.
The high price of crude oil will also benefit Yinson because Yinson is allowed to claim bonus on the crude oil.
No oil company will terminate the FPSO contract because of huge profit.
All oil company will be laughing happily to the bank.
The limitation is Yinson can build one FPSO vessel a year only.
I believe Yinson will get 2 FPSO contracts at the end of 2023 or early 2024.
2 FPSO vessels FPSOs Maria Quitéria and Atlanta will be completed construction at the middle of 2024.
Hence 2 new FPSO contracts will come in just in time to fill up the slots.
Thank you.

The most unfortunate timing in my view...is the expiry of warrants by mid-2025, before all the super earnings come into full blast hehe
-------------------
It is still in time because 2 big FPSOs Maria Quitéria and Atlanta will be in full operations in the middle of 2024. 50% of the PAT will be included in FY2025 result (Jan 2025).

The PAT for FY2025 will be > 1 billion.
Thank you.

This portfolio made huge profit during that time in 2013.
The loss shown is not reflective because of the share price changed and not updated.
These 2 persons have intentions to bad mouth me.
Thank you.

PAT margin is low because of finance lease accounting, the investment in CAPEX to construct the FPSO is recognized as a contract asset on the balance sheet.
The CAPEX to construct the FPSO is included in the revenue reporting, this inclusion inflated the revenue number resulted in low PAT margin.
FPSO vessel in construction stage, the PBT is only 7.6% of the Revenue whereas in charter service rate, the PBT is 39.6% of the Revenue.

Under finance lease accounting, the investment in CAPEX to construct the FPSO is recognized as a contract asset on the balance sheet. The change in contract asset must be included in reported cash flow from operations. In reality, this change in contract asset represents CAPEX to build new FPSOs and should not be considered as operating cash flow. The actual operating cash generated for FY Jan23 should be RM1.36 bn.
Thank you.

Yinson quarter results
https://www.malaysiastock.biz/Corporate-Infomation.aspx?securityCode=7293
Q1 2024 - Revenue =3018M, PBT=296M, PAT=208M, EPS=6.10, PAT margin =6.89%, PAT/PBT%=70.3%
Q2 2024 - Revenue =3113M, PBT=449M, PAT=230M, EPS=6.70, PAT margin =7.39%, PAT/PBT%=51.2%
Half year PAT=438M

IB reports and target price projections
IB/FY2024/FY2025/TP
MBB/872/1008/5.05
UOB/648/854/3.95
KEN/603/731/3.65
AMI/823/798/3.96
RHB 436/767/3.06
Q2 July 2024 result - PBT is good.
Q2 July 2024 result - PAT is low even PAT margin is higher than Q1 April 2024 result.
Half year PBT=745M, PBT for FY2024 will be estimated at least 1.450 billion.
If PAT/PBT%=0.703, PAT=1.019 billion. If PAT/PBT%=0.512, PAT=742.4 million. The average is =880 million. Please note that the PAT for the second half of FY2024 will be better than the PAT for the first half of FY2024. Full charter service rate at 39.6% PBT of FPSO Anna Nery will be included in the second half of FY2024.
Half year PAT=438M, I believe this projection of PAT for FY2024 is inline with MBB's projection.
Based on MBB's projection, the target price for Yinson is at 5.05.
The PAT for FY2025 will be better than PAT for FY2024 because FPSO Anna Nery will be in full operations. Moreover, both FPSO Maria Quiteria and FPSO Atlanta will be in operations in FY2025, they will contribute about 50% of their revenues and also PAT.
The PAT for FY2025 will be > 1 billion.
The share price of Yinson closed at 2.37 on 6/10/2023 is definitely undervalued.
Thank you.

Please do not talk nonsense here.
Do not waste your time here.
Spend your time to analyse stocks to recommend to all readers here.
At least you help all readers here.
Please show some good deeds here.

I still believe Yinson will perform well in the next 3 years because of strong order book. There are a total of RM 110 billion order booked todate.

All 3 major FPSO projects will be in full operations starting from Q1 2026 onward. I know that the present debt of 11 billion is high, please note that once the FPSO vessel is ready and accepted by the oil company, the debt will be transferred to the oil company.

If Yinson does not take up any project after Q1 2026, the debt will be reduced to almost zero.
The free cash flow generation should be more than RM3bn each year from FY Jan-27 onwards. This level of free cash flow generation should be sustainable for at least 15 years based on the firm lease period.

I believe Yinson will be a component stock of KLSE from FY Jan-27 onwards.

Thank you.

Please note that Yinson is the best FPSO lease contractor in the world, Yinson never fail to deliver the FPSO vessel in time and it is the preferred lease contractor among all 8 major lease contractors in the world.

FPSO contract will be in great demand because the cost of production of oil is less than USD10 per BBL.

The oil company even pays cash upfront to Yinson to construct the FPSO vessel because it is a very high profitable business.

The oil company of FPSO Agogo project paid USD 500 million upfront to Yinson for the construction cost of FPSO Agogo vessel.

Most investors in KLSE did not notice this news and say that the debt of Yinson is very high. The construction cost of FPSO is very high, it is amounted to hundred of million in USD.

The debt on the construction cost of FPSO vessel will be transferred back to the oil company once the FPSO vessel is accepted by the oil company. This type of arrangement is in the agreement and the oil company has to accept this term because this type of FPSO business is very high in profit due to low production cost of less than US10 per BBL.

Thank you.

I have been a remisier for 30 years.
I have seen many of my friends and clients make multi million profit from KLSE.
They are all investors and use the strategy to buy and hold to make profit.
I learned all these strategies from them to make my multi million profit from KLSE.
I never saw any contra player make a million profit from KLSE, do not even mention multi million profit from KLSE.
I have seen many contra players lost until bankruptcy.
If my client is a contra player, I will tell the client to close the trading account.
I do not want this type of client because I worry this client cannot pay the contra losses.
I have written off a few million from all contra clients, I really cannot sleep well if the client is a contra player and buys a big position on contra.

Do not tell me that a contra player can make 12.5 million profit, he is just bullshiting and telling lies in I3.

95% of contra players lost money in the stock market.
Decide yourself what type of player you want to be.
Please take my advice seriously.
Thank you.

I watch "Youtube" on Francis Yeoh's interview on YTLPower, if you invested 1 million in 1987, your return (ROI) is 156 million in 2023 ie 15500%.
I believe all assets of YTLPower will increase exponentially in the next few years.
Invest in YTLPower as a long term investment like what dragon328 recommended.

The present correction is just a normal correction.
The share price does not move up north in a straight line, It needs correction in order to move up to new high.
The final decision is always yours.
Thank you.

Posted by UncleFollower > 3 days ago | Report Abuse
@Zhuege_Liang we small fry.

Please ask star investor OTB publish this opinion give some advice to Yinson Lims and hopefully gain some traction. Also, before Agogo contract locked-in, they have been doing SBB as high as 2.48. Also, >100B contract value is unheard of in Bursa - and market cap less than 7B, how can.
---------------------------
Dear UncleFollower,
I have written an official letter to the Board Of Directors of Yinson on this matter.

I also highlight this item as well.
According to the below IBs, the target price of Yinson should be as follows :-
Maybank - 5.05
AMI - 3.96
Kenanga - 3.65
UOB - 3.75
CIMB - 3.27
RHB - 3.06

Note :
Based on Maybank's report, the target price of Yinson is at 5.05.
If this target price can be achieved, the market cap of Yinson is > 15 billion.
Then Yinson can be considered as a component stock of FBMKLCI.
The market cap of YTLPower is about 15 to 16 billion (to be included in FBMKLCI component stock in December 2023).

I also requested the Board Of Directors of Yinson to talk to Board Of Directors of EPF to stop selling Yinson share at such a low price now.
If the share price of Yinson can be at 5.05 as recommended by Maybank Investment Bank, then Yinson share will be included into the component stock of FBMKLCI.
It will be a win-win situation for both Yinson and EPF if Yinson share can be a component stock of FBMKLCI.

Hope my letter to the Board Of Director of Yinson will help to boost up the share price of Yinson.
Thank you.

According to the below IBs, the target price of Yinson should be as follows :-
Maybank - 5.05
AMI - 3.96
Kenanga - 3.65
UOB - 3.75
CIMB - 3.27
RHB - 3.06

Note :
Based on Maybank's report, the target price of Yinson is at 5.05.
If this target price can be achieved, the market cap of Yinson is > 15 billion.
Then Yinson can be considered as a component stock of FBMKLCI.
The market cap of YTLPower is about 15 to 16 billion (to be included in FBMKLCI component stock in December 2023).

Thank you.

Salient points of the recommendation report posted by Oaklands Path
Please read this report via the link below.
https://www.oaklandspath.com/the-fpso-industry-and-top-tier-lessor-and-operator-yinson

1.) Yinson is the only FPSO company that has consistently turned a profit over the past decade. It has a proven track record of delivering FPSO projects on time and within budget, even during the COVID-19 pandemic. It was the only company in the world not to delay a project due to the pandemic.
2.) Yinson has also had no major health, safety, or environmental or downtime incidents. As a result of its strong track record, Yinson is a preferred bidder in the market.
3.) Yinson has the capacity to build 1 FPSO vessel a year only.
4.) Yinson is the only FPSO lease contractor that is consistently profitable throughout the period.
5.) Yinson entered the offshore oil production industry in 2012 and its margin has been increasing since then. However, the average margin in the last four years is lower than the previous years due to the accounting treatment of finance leases. Under finance lease accounting, Yinson is required to recognize construction revenue and profit during the construction phase, which lowers the company's margin. Once these FPSOs start operation, Yinson's margin should start moving up again. Construction profit is only 7.6% of the revenue whereas chartering service contract rate is 39.6% of the revenue.
6.) After winning the bid, the FPSO lease contractor (Yinson) will build the FPSO and deliver it within the agreed-upon timeframe. The lessor will be responsible for financing the construction and ownership of the FPSO. However, after final acceptance and release of performance guarantee by the client, the loan will become non-recourse to the lessor and will instead be guaranteed by the oil company through the novation of guaranteed lease payment.
7.) The FPSO lease contractor (Yinson) will focus on achieving final acceptance and after which, it will be entitled to full day rate payment and the loan will no longer be recourse to the lessor. In other words, the loan no longer belongs to Yinson and the loan is transferred to the owner of the oil company once the FPSO vessel is subjected to final acceptance and release of performance guarantee by the client.
8.) FPSO Anna Nery achieved financial acceptance on May-23 and began generating lease income. Currently, it still has 3 more FPSOs under construction. FPSO Atlanta and FPSO Maria Quiteria will be delivered next year and FPSO Agogo will be delivered by Feb-26.
9.) Likewise, the loans of 3 FPSO presently under construction will disappear in 2024 and 2026 respectively once the FPSO vessel is subjected to final acceptance and release of performance guarantee by the client. These loans will be transferred to the respective oil company.
10.) Yinson focuses on getting long-term charter contracts, which generate long-term revenue. Focusing on larger vessels with longer firm lease period naturally lowers the risk of termination. FPSOs are essentially floating oil factories. For large oil fields, the average cash production cost per barrel is only a few US dollars. All the exploration and subsea assets invested are sunk costs, so even if the oil price drops to US$30 per barrel, it still makes sense for oil companies to continue producing oil, as the variable cost is less than US$10 per barrel. This is why we have historically seen very few cancellations of FPSO contracts, even when oil prices are low. Terminations usually happen when the productivity of a field turns out to be much lower than the initial estimate, and this risk is borne by the oil companies.
11.) Renewal Energy (RE) and GreenTech - In early 2021, it secured a new contract to build, own and operate a 285MWp(DC) solar plant, which is currently under commissioning in the Nokh Solar Park, India. Unfortunately, the sudden surge in solar panel prices after the contract was awarded resulted in an impairment loss of RM117m recognized in FY Jan-23.
12.) Assuming Yinson does not take on new jobs and does not spend further CAPEX in the renewable energy division, its free cash flow generation should be more than RM3bn each year from FY Jan-27 onwards. This level of free cash flow generation should be sustainable for at least 15 years based on the firm lease period.
13.) The actual operating cash flow should reach over RM3bn in calendar year 2026 and is sustainable for at least another 15 years based on the firm period alone. This compared to a market cap of RM7.4bn today with total net debt of RM11bn. The debt could be fully paid within a few years if the company does not take on a new project. The cash leftover for shareholders may equal 5 to 8 times of today’s market cap i.e. may equal to 59.2 billion in 15 years time.

Thank you.

Dear HuatRex1314,
Noted.
Thank you.

@Permutation,
Based on Maybank report, the target price is 5.05.
The fundamental of Yinson is very good, please read the report from Oaklands Path.
No one will know whether Yinson can perform or not.

According to the below IBs, the target price of Yinson should be as follows :-
Maybank - 5.05
AMI - 3.96
Kenanga - 3.65
UOB - 3.75
CIMB - 3.27
RHB - 3.06
Thank you.

Posted by James_Bond > 2 days ago | Report Abuse
Robert is extremely high risk taker! Do you know Yinson might end up like Evergrande Group 2.0? Anyway, Good Luck!
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Posted by James_Bond > 2 days ago | Report Abuse
High borrowing will kill Yinson! It kills Evergrande Group successfully! Next, will it be Yinson, high borrowing company?
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@James_Bond,

Oaklands Path is a broker authorised by the Hong Kong Stock Exchange.

Please read this report via the link below.
https://www.oaklandspath.com/the-fpso-industry-and-top-tier-lessor-and-operator-yinson
This article would not have been possible without the sharing of Raymond Yap of CGSCIMB and Keat Seng of KSC.
Note :
FPSO Anna Nery achieved financial acceptance in May-23 and began generating lease income.
Currently, it still has 3 more FPSOs under construction.
FPSO Atlanta and FPSO Maria Quiteria will be delivered next year and FPSO Agogo will be delivered by Feb-26.
The present debt incurred by the aforesaid 3 FPSO vessels.
The high debt will disappear by 2026 if the company does not take on new project.
Example.
FPSO Anna Nery achieved financial acceptance in May-23.
The loan is no longer belong to Yinson and the loan is transferred to the owner of the oil company once FPSO Anna Nery is accepted for full operations.
Likewise, the loans of 3 FPSO presently under construction will disappear in 2024 and 2026 once the FPSO is accepted for full operation and subjected to final acceptance by the oil company.

The actual operating cash flow should reach over RM3bn in calendar year 2026 and is sustainable for at least another 15 years based on the firm period alone. This compared to a market cap of RM7.4bn today with total net debt of RM11bn.

The debt could be fully paid within a few years if the company does not take on a new project. The cash leftover for shareholders may equal 5 to 8 times of today’s market cap i.e. may equal 59.2 billion in 15 years time.

Please read the aforesaid article again and again, all your questions will be resolved.
The aforesaid article written by Oaklands Path on Yinson is very good, you will understand the fundamental of Yinson very well.
Thank you.