in Blog, Singapore Stocks, Stocks, 3 comments

Seatrium – Outlook Remains Bright In 2024

by Augustine // December 8, 2023  

”

Looking for a trusted Stock Remisier?
Augustine works closely with a small group of clients - providing regular market updates, Bazi & astrology wealth insights, and clear guidance to invest with confidence.

📩 Check out my profile here today!

Excerpts from UOBKayHian report https://www.youtube.com/watch?v=3VMmkeP9d1E You can also check out my video above ^

Seatrium Limited (SGX: S51)

  • Seatrium’s outlook in 2024 remains bright, in our view, as we expect new order wins in both the oil & gas as well as renewables sectors.
  • In the near term, this could come in the form of two Brazilian FPSOs while in the medium to longer term, renewables demand remains well supported.
  • The company’s strategic review remains on track to be completed by end-23.
Maintain BUY. Target price: S$0.19.

Positive outlook

Seatrium presented an upbeat outlook on the offshore marine and renewables industry to nearly 40 institutional investors at the UOB Kay Hian Asian Gems conference earlier this week. While new rig orders may be 1-2 years away, the company will continue to focus on a return to profitability, safe and on-time execution of its current S$19.7b orderbook as well as to fill up the gap in its orderbook pipeline for 2026-29.

Strategic review to be completed by end-23

Management commented that its “ambitious” strategic review is ongoing and, among other issues, will address:
  • extraction of cost and revenue synergies between the merged companies
  • the inevitable consolidation of its global network of yards,
  • the company’s ideal capital structure going forwards
  • potential consolidation of its shares (which appears to be a 2024 event in our view), and
  • target orderbook mix between renewables and oil & gas projects.
In addition, the strategic review will also look at what sort of investments the company will need to make in the areas of digitisation, robotics and artificial intelligence, which will partially address the issue of a chronic labour shortage that has affected many industries globally.

Update on Brazilian FPSOs

The company has submitted its tender for the P-84 and P-85 FPSOs for Petrobras’ Atapu and Sépia fields respectively and, as is standard procedure, Seatrium is currently going through the negotiation with Petrobras regarding the price as well as a technical review. Management appeared somewhat optimistic that the results of the tender could be known by year end.

Valuation/Recommendation

We maintain our BUY rating on Seatrium with a P/B-based target price of S$0.19. Our target P/B multiple of 1.5x is 2SD above the company’s five-year average of 1.0x and is pegged to its 2024 book value of S$0.125. Given the company’s exposure to the offshore marine upcycle, we strongly believe that Seatrium’s current P/B valuation is inexpensive. Risks include higher-than-expected provisions for 2023, negative news flow regarding its CPIB case and volatile oil prices.
Seatrium share price
You can find the full report here and the company website here.
Previous
Next

About the author Augustine

Be A Valued Client of Augustine in Lim&Tan Securities
Receive Augustine’s regular stock updates via Telegram plus full access to his private client hub with exclusive research, astrology and Bazi insights.
(Exclusive Readings for Clients Only)

Leave a Comment

Check Out Our Latest Articles

DBS Group – A Bazi Analysis

Many investors would have known about DBS Group Investors would have make decent gains as the share price has been rising for the past few years. In fact, investors would have gain a total return of 131.93% excluding dividends received if he purchased the share 5 years ago! Many investors would already know about the

Read More

Apple Stock Analysis: Using Fundamentals and Bazi

This is an in depth analysis on Apple stock both using Fundamental and Bazi analysis. Apple remains a cash-generative, platform-centric technology leader with a resilient earnings mix. In fiscal Q4 2025 Apple posted revenue of $102.5 billion and non-GAAP EPS of $1.85, driven by a strong iPhone cycle and record Services revenue. That result reinforced

Read More

3 SGX High Yield Small Cap Dividend Stocks to Watch

Looking for SGX high yield small cap dividend stocks that offer strong passive income potential without relying only on large-cap blue chips or REITs? In Singapore, most dividend investors immediately turn to banks, REITs or government-linked companies for stability, but there are smaller gems that may offer attractive yields while still operating solid business models.

Read More