Avance Gas (Sell, TP: NOK77.00) - cNOK77/share breakup value
We calculate a NAV of NOK77/share on the prevailing BW LPG share price, which in our view is the fair valuation of the company. Raising the BW LPG shares’ value equal to our NOK200/share target price, we estimate a NAV broadly in line with Avance Gas’ share price. However, with the expected winding up of the company in 2025, we believe a direct investment in BW LPG offers a more attractive position. Hence, we have downgraded to SELL (HOLD) and cut our target price to NOK77 (111) following the latest dividend payment.Avance Gas Holding is principally engaged in the transportation of Liquefied Petroleum Gas ("LPG"). Co. operates a fleet of 14 Very Large Gas Carriers, providing transportation services to oil majors and traders of LPG on a global basis. Co. transports LPG from the Middle East and the U.S. Gulf or U.S.loan facility from BCBloan facility from BCB(excludes dividends satisfied by issue of shares) East Coast to destinations in Europe, South America and Asia.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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