Keyfield International Berhad (Keyfield) is expected to ride the high waves of strong demand for the Offshore Support Vessel (OSV) services in the second half of the year, as analysts project upward trend for the local OSV market in view of rising demand against tight supply.
The company earlier won eight work order awards (WOAs) from Petronas Carigali Sdn Bhd involving six accommodation work boats (AWB) and two anchor handling tug & supply (AHTS) vessels under its Panel Contractor Contract (PCC). The work orders were valued at approximately RM130.3m, with duration ranging from 91 to 153 days per vessel.
Under the deals, the implied daily revenue per vessel, inclusive of daily charter rate (DCR), catering, and other auxiliary services, amounts to RM100,000-110,000 for the AWBs. The work orders utilised four of Keyfield's own vessels and two chartered vessels. The two AHTS vessels, on the other hand, were chartered, with DCRs ranging between RM50,000 – RM55,000.
According to Kenanga, the above-noted combined revenues from the AWBs and AHTS were considered in line with expectation of RM129,000 DCR in 2024 for AWBs and chartered third-party vessels.
Keyfield is currently in the peak season of OSV market (typically 2Q and 3Q of the year), and vessel utilisation is expected to remain strong going into the third quarter.
The group took delivery of Keyfield Itqan (formerly known as Belait Barakah), a 239-pax accommodation work barge, on 3rd July 2024. Keyfield Aulia (a second-hand AHTS vessel) was also added to the company's fleet after being delivered on 13 August 2024. These vessels are expected to start contributing from the fourth quarter onwards, further driving earnings growth. Overall, DCRs are projected to trend upward in the local OSV market, as supply remains tight while client demand continues to increase.
Kenanga maintains its earnings forecasts for Keyfield, a target price (TP) of RM3.18 and an OUTPERFORM call.
As at 10:30am Thursday, Keyfield's stock traded at RM2.40. (Stock updates from )
