PVD – Rising rig day rate to accelerate the earnings
- PVD posted positive results in the fourth quarter compared to the previous three quarters in spite of recording VND30 bn provision from Kris Energy and a sharp increase in financial expenses following the rise of interest rates. Specifically, the company booked VND 54 bn in NPATMI compared to the loss in the first 3 quarters of the year.
- PVD has signed the full contract for its 4 jack-up rigs in 2023 with minimum average rig day rate of 75,000 USD/day. At this day rate, we think the core business of PVD can gain profit after getting loss in many years before.
- The company is actively looking for new contracts for 2024. We believe that acquiring contracts for 2024 at the this time will help PVD receive a better day rate compared to the 2023 level. Currently, the rig day rate in Southeast Asia (SEA) has reached 120,000 USD/day and is forecasted to reach 160,000 USD/day by 2024.
- For 2023, we forecast that PVD can reach VND6,834 bn in revenue and VND344 bn in NPATMI, higher than our previous forecast. We remain BUY recommendation and raise PVD's target price from VND21,500 to VND26,800 to reflect PVD's positive outlook in 2024 thanks to a day rate that closes to the SEA level.
PetroVietnam Drilling & Well Service Corporation is a Vietnam-based provider of oil and gas drilling services. The Company's operation is organized under three segments, including Drilling Services segment, which leases oil rigs and performs drilling services on a contract basis; Trading segment, which distributes equipment and supplies for oil drilling businesses, and Other Services segment, which provides diversified related services, such as oil well surveying and mapping, mud logging, oil spill containment, human resources outsourcing and project management.
Viet Dragon Securities belongs to top 20 biggest securities companies in terms of chartered capital in Vietnam. With a qualified, dedicated and professional team, a widespread network, advanced technology, diversified products and services, and good relationship with local and foreign institutions, we provide a wide range of services and products to our clients both individuals and institutions, both local and foreign. We commit to provide our clients with promising investment opportunities and a comprehensive and professional financial investment services.
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