Dorian LPG (Buy, TP: USD26.10) - Slimming down the NAV discount
Market tailwinds serve Dorian LPG’s cash generation well, and the company has built a consistent track record of strong yields, with further potential from the current FFA curve of cUSD60k/day versus our USD40k/day estimate. The valuation continues to rise, with an EV/GAV of 0.90x implying historically high values of USD73m for a 5-year old VLGC amid abundant US propane inventories. We reiterate our BUY and USD26.1 target price.
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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