reports
- Kong Ho Meng
Oil & Gas - Navigating Out Of US-Iran’s “Operation Epic Fury”
Navigating Out Of US-Iran’s “Operation Epic Fury” Highlights The US-Iran conflict may be compared to the Russia-Ukraine war. In both cases, energy stocks may correlate to near-term spikes in O&G prices at the start. In the case of Russia-Ukraine, eventually the renewable theme stocks outperformed the energy stocks. However, uncertainties arise as the war drags on. For example, MISC benefits from the sentiment from spikes in rates for crude tankers and LNG carriers. However, markets may price i...
- Desmond Chong Chee Wai
- Vincent Khoo Boo Aik
Strategy - Digging Into A More Defensive Mode
Digging Into A More Defensive Mode Highlights The past week’s events require reassessment of the financial impact of the US-Israel vs Iran conflict. With Iran’s organised and persistent military response that has targeted/crippled the regional logistics/production of crude oil, the situation could morph into a war of attrition and further elevate Brent crude oil prices by more than 20% to over US$88/bbl. Such a scenario raises the probabilities of Brent crude oil prices rising to US$100/bbl, s...
- Kong Ho Meng
Oil & Gas - Petronas: Emerging Stronger After 2025
Petronas: Emerging Stronger After 2025 Highlights Emerging stronger after weathering through 2025. Described as a year of polycrisis that caused a 19% decline in profits, and necessitates the group to execute right-sizing exercises (two more phases in Mar and Jul 26), Petronas’ cash flow preservation remains commendable. Looking ahead, with much lower dividend obligation and minor upside to normalised capex commitment levels, 2026 can be viewed as a year for Petronas to refocus on its renewed,...
- Kong Ho Meng
Malaysia Marine And Heavy Engineering Holdings (MMHE MK) - 4Q25: A New...
4Q25: A New Life For Marine Repair Highlights 2025 results surprised on the upside, due to marine repair. Despite falling revenues as O&G fabrication jobs are at their tail-ends, MMHE gained positive claims from completed projects. The positive surprise in this quarter is the marine division which saw many record highs in its quarterly profit, and capacity to undertake more high-value LNGC retrofits/ repairs. We are not concerned over its declining O&G orderbook as we view MMHE as rightly posi...
- Kong Ho Meng
Oil & Gas - MBR 2026: A Key Enabler Towards 2m BOEPD Goal
MBR 2026: A Key Enabler Towards 2m BOEPD Goal Highlights MBR 2026 to explore new frontiers in unlocking the full potential of Malaysia’s basin. A positive surprise was that local production increased to about 1.9m boepd in 2025 despite 1H25 setbacks. While the long-term sustainable target remains at 2m boepd, the increased funnel of field development plans that are made possible through the collaboration of new PSCs, innovations and simplifications, are showing results. The ambitious scope of ...
- Kong Ho Meng
Oil & Gas - PAO 2026-28: Walking The Talk On OGSE Ecosystem Imperative
PAO 2026-28: Walking The Talk On OGSE Ecosystem Imperative Highlights Unlike previous PAO editions, the OGSE Imperative may be the right ingredient for both Petronas and the industry to move forward. Petronas is sending a clear message that the OGSE ecosystem is not ancillary, but a vital component to Petronas’ own sustainability. As OGSE evolves into a globally competitive value chain, it will directly boost Petronas’ global market relevance and ability to deliver energy security by upholding...
- Kong Ho Meng
Malaysia Marine And Heavy Engineering Holdings (MMHE MK) - 3QFY25: Sev...
3QFY25: Several Breakthroughs Highlights 9M25 results contained a few breakthroughs. Despite lower revenues, we were positively surprised by another recognition of an unspecified amount of favourable finalisation of a completed project. Marine repair profit margins are still below the historical average, but we have an alternative view: a short-term strategy to sacrifice profit margin to boost market share and rebuild track record. As a result, Malaysia Marine And Heavy Engineering Holdings (M...
- Kong Ho Meng
Malaysia Marine And Heavy Engineering Holdings (MMHE MK) - 1H25: Profi...
1H25: Profits Below Expectations On Weak Marine Profit Margin 1H25 profit missed expectations due to lower ship repair margins (despite healthy volumes). Seatrium reported the same trend citing trade-related uncertainties and weak LNG markets (that prompted LNG ships to defer non-essential repairs). While MMHE will strive to maintain execution on completing Kasawari CCS on time, we fear its discounted valuation may be tied to the wider sentiment of Malaysia’s CCS conundrum. Cut forecasts by 50%....
- Kong Ho Meng
Malaysia Marine And Heavy Engineering (MMHE MK) - 1Q25: Profits In Lin...
1Q25: Profits In Line, But Uncertain Outlook For Marine Repair MMHE reported commendable 1Q25 profits, aided by project close-outs, although marine is the star performer which recorded a profit base close to pre-2017 levels. The conversion jobs of LNG Puteri Satu and FPSO Bunga Kertas (one of the toughest in its category) might have factored into 1Q25, but contract replenishment is now a risk. We also view Petronas-Petros implications as a permanent mark on sector valuations. Under these assumpt...
- Kong Ho Meng
Oil & Gas - Geopolitical Risk May Extend to CCS, Allowing Sector Conso...
Geopolitical Risk May Extend to CCS, Allowing Sector Consolidation Regardless the details to be announced in PM Anwar and Sarawak Premier Jo’s new agreement later this week, we take a view that the Petronas-Petros geopolitical risk may prolong, extending to carbon storage (the next business frontier for the sector), until the shift of monetary flows are more balanced between the regions. If this happens, the sector will have breathing space to consolidate; hence, we continue to advise focusing o...
- Kong Ho Meng
Oil & Gas - Clear Water Muddled By “Grey Areas” — Simply Theatrics Or ...
Clear Water Muddled By “Grey Areas” — Simply Theatrics Or Chess Game? Petronas reported lower profit yoy amid a weakened LNG position and higher costs in 2024, due to various events including the Petronas-Petros development. Lately, some “misunderstandings” on the scope (i. LNG) and the correct DGO date are potentially precarious. If they are proven to be mere theatrics, then these matters should be resolved quickly. However, if the chess game prolongs, it will contribute towards sector risks. W...
- Arsit Pamaranont
- Benjaphol Suthwanish
- Carol Dou Xiao Qin
- Chong Lee Len
- Ejann Hiew
- Heidi Mo Jinghui
- John Cheong Ming Chern
- Jonathan Koh
- Kampon Akaravarinchai
- Kasemsun Koonnara
- Kong Ho Meng
- Llelleythan Tan Tan
- Paula Ruth
- Philip Wong
- Shirley Wang Xueyi
- Stella Guo Yuting
- Sunny Chen
Regional Morning Notes - Thursday, February 20, 2025
GREATER CHINA Sector Dairy: Retail demand remains weak; price recovery and healthier inventories to drive shipment normalisation. Healthcare: Outperformers empowered by AI revolution. INDONESIA Update Champ Resto Indonesia (ENAK IJ/BUY/Rp585/Target: Rp740): 2025 revenue to grow 16% yoy; more conservative on 4Q24 performance. Maintain BUY. MALAYSIA Results Duopharma Biotech (DBB MK/BUY/RM1.28/Target: RM1.39): 4Q24: Largely delivers on earnings. Public sector sales anchor growth while margins im...
U11 UNITED OVERSEAS BANK LTD. (SINGAPORE)
5186 MALAYSIA MARINE AND HEAVY ENGINEERING HOLDINGS BHD
Z74 SINGAPORE TELECOMMUNICATIONS LIMITED
BCH BANGKOK CHAIN HOSPITAL PCL
SPRC STAR PETROLEUM REFINING
GMB GAS MALAYSIA BHD
DBB DUOPHARMA BIOTECH BHD
MPM MARCO POLO MARINE LTD
ENAK CHAMP RESTO INDONESIA TBK
STECON STECON GROUP PUBLIC COMPANY LIMITED
- Kong Ho Meng
Oil & Gas - O&G Landscape Entering “Right-Sizing” Mode
O&G Landscape Entering “Right-Sizing” Mode Petronas has confirmed a downsizing exercise, involving a review of 30% of its staff force, as it aims to be nimble for its survival. While this exercise is not driven by the Petros saga, we are concerned about the potential impact on the sector’s earnings, given its timing will coincide with heavy plant turnarounds. The Shell MDS injunction against Petronas/Petros implies more uncertainties. Should near-term earnings risk materialise, we advise accumul...
- Kong Ho Meng
Oil & Gas - PAO 2025-27: Rationalisation Across Three Regions
PAO 2025-27: Rationalisation Across Three Regions Despite being published remarkably later than usual, the PAO offers new insights, in particular activity outlook across three regions and clearer plant turnaround distinction between Upstream/Downstream/Gas segments. Aligning with our view, there are cuts in exploration-stage and JU rig outlook, but maintenance demand is largely intact. Plant turnaround is the biggest winner in our opinion, but we identified 2Q25, 2Q26 and 1Q27 as critical period...
- Kong Ho Meng
Oil & Gas - Sarawak And Petronas To Continue Strategic Collaboration I...
Sarawak And Petronas To Continue Strategic Collaboration In Gas Industry With Petros As Sole Gas Aggregator Both Prime Minister Anwar Ibrahim and Sarawak Premier Abang Johari (Abang Jo) released statements that there are no more issues and ambiguity in policy matters related to Petronas Nasional Bhd (Petronas), the country’s national oil company, and Petroleum Sarawak Bhd (Petros), Sarawak’s sole gas aggregator, regarding Sarawak’s gas distribution rights. Petros assumed the sole gas aggregator ...
- Anas Fitri Bin Ahmad
- Benjaphol Suthwanish
- Chong Lee Len
- Desmond Chong Chee Wai
- Heidi Mo Jinghui
- John Cheong Ming Chern
- Julia Pan Mengyao
- Kampon Akaravarinchai
- Kitpon Praipaisarnkit
- Kong Ho Meng
- Llelleythan Tan Tan
- Malaysia Research Team
- Ming San Soong
- Stevanus Juanda
- Tanaporn Visaruthaphong
- Wei Xiang Ku
Regional Morning Notes - Thursday, November 14, 2024
GREATER CHINA Results Tencent Holdings (700 HK/BUY/HK$403.80/Target: HK$570.00): 3Q24: Solid earnings beat; mini shop and potential blockbuster as key catalysts. INDONESIA Results Aspirasi Hidup Indonesia (ACES IJ/BUY/Rp835/Target: Rp1,200): 3Q24: NPAT up 13.7% yoy; slightly above consensus expectations. MALAYSIA Results Malaysia Marine and Heavy Engineering Holdings (MMHE MK/BUY/RM0.44/Target: RM0.70): 1H24: Positively surprises on project cost claims. Marine segment still weakened by competi...
PTT PTT PUBLIC COMPANY LIMITED
BN2 VALUETRONICS HOLDINGS
5186 MALAYSIA MARINE AND HEAVY ENGINEERING HOLDINGS BHD
PLANB PLAN B MEDIA
AWX AEM HOLDINGS
Z74 SINGAPORE TELECOMMUNICATIONS LIMITED
HANA HANA MICROELECTRONICS PCL
ACES PT ACE HARDWARE INDONESIA TBK
00700 TENCENT HOLDINGS LTD.
CPALL TB CP ALL
HAPL HAP SENG PLANTATIONS HOLDINGS BHD
VST VSTECS BHD
- Kong Ho Meng
Oil & Gas - FPSO Outlook Weighed Against Energy Transition
FPSO Outlook Weighed Against Energy Transition While the FPSO industry benefits from an all-time high backlog, we think players should sharpen their focus on decarbonisation/clean energy pathways, as we foresee diverging patterns in this “new field growth” depending on various factors. For example, it seems solar and wind will not be part of Bumi Armada and Yinson Production (the FPSO arm), even though wind is officially under SBM Offshore. MISC remains as a green transportation arm though it ma...
- Kong Ho Meng
Malaysia Marine And Heavy Engineering (MMHE MK) - 1H24: Surprise Profi...
1H24: Surprise Profit From Project Claims, Marine Diversification Bearing Fruit MMHE surprised positively with new milestone in profit and EBITDA in 2Q24, driven by project cost claims while existing projects execution remains unperturbed. This more than offset weakness in the marine segment which may find sustaining the high-margin contract pool to be challenging, amid intense competition. Fortunately, MMHE’s marine diversification is bearing fruit via a successful entry into the Greek maritime...
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Chong Lee Len
- Jo Yee Ng
- Johnny Yum Chung Man
- Jonathan Koh
- Kasemsun Koonnara
- Kate Luang
- Ken Lee
- Kenny Yong Hui Lim
- Kong Ho Meng
- Paula Ruth
- Roy Chen Chengzhi
- Sunny Chen
Regional Morning Notes - Thursday, August 22, 2024
GREATER CHINA Results Crystal International (2232 HK/BUY/HK$3.54/Target: HK$4.92): 1H24: Stronger 2H24, expect restocking into 1H25. CSPC Pharmaceutical Group (1093 HK/SELL/HK$5.68/Target: HK$5.00): 1H24: Results miss; major products face considerable price pressure. Downgrade to SELL. Geely Auto (175 HK/BUY/HK$7.88/Target: HK$13.00): 1H24: Core earnings up 108% yoy, in line with estimates. Maintain BUY. Target price: HK$13.00. Hong Kong Exchanges and Clearing (388 HK/BUY/HK$228.60/Target: HK$30...
00388 HONG KONG EXCHANGES & CLEARING LTD.
SXC SUNNY OPTICAL TECHNOLOGY (GROUP) CO. LTD.
5186 MALAYSIA MARINE AND HEAVY ENGINEERING HOLDINGS BHD
SATS SP SATS LTD.
01810 XIAOMI CORP. CLASS B
MAXIS MAXIS BHD
1833 PING AN HEALTHCARE AND TECHNOLOGY COMPANY LIMITED
1093 CSPC PHARMACEUTICAL GROUP LTD
CK CH. KARNCHANG PUBLIC CO LTD
2232 CRYSTAL INTERNATIONAL GROUP LTD
- Kong Ho Meng
Oil & Gas - Cautiousness in Business Enquiries: Signs Of Local O&G Cap...
Cautiousness in Business Enquiries: Signs Of Local O&G Capex Slowdown? Geopolitical risk may be the norm in the new world order, but we think this has been happening in Malaysia for the past six years. The highlight of this saga is when Petros took over the role of sole gas aggregator of Sarawak’s gas business, followed by major changes in Petronas’ top leadership roles. Although nothing is confirmed, channel checks suggest activities are slowing down. We advocate defensive stocks that are diver...
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