The news: Mun Siong Engineering (MS Engineering) announced that it has entered into a MOU with PetroVietnam Maintenance and Repair Joint Stock Company (PVMC) to develop business opportunities in refineries, fertilizer plants, chemical plants and other oil and gas facilities in Vietnam for mutual advantages and benefits. PVMC is part of the Vietnam National Oil and Gas Group (PetroVietnam) which provides diversified technical services for the oil and gas industries in Vietnam.
Our thoughts: The MOU would allow PVMC and MS Engineering to utilize their knowledge, experience and expertise to assist each other in implementing projects in refineries, petrochemical, chemical and oil and gas industries in Vietnam. Both parties will provide services that are required in process plant such as pre-commissioning, process plant maintenance, turnaround services and other specialized engineering services. With a huge demand for oil and gas structure maintenance and repair in Vietnam, we think potential contract wins for MS Engineering lies ahead. In addition, with the expected wave of downstream investments on Jurong Island, we believe the demand for MS Engineering’s mechanical and electrical and instrumentation services in Singapore would be boosted. Maintain BUY with TP of S$0.25, based on our DCF valuation (WACC of 12.1% and terminal value of 1%).
No comments:
Post a Comment