10 April 2008
Cosco Corporation (S) Ltd (COS SP / COSC.SI, OUTPERFORM - Maintained,
S$3.36, Target: S$5.55)
Quick takes - The good and the bad
by LIM Siew Khee
Cosco has won contracts worth US$292.3m, comprising a US$131.8m
semi-submersible production unit hull and two 59,000dwt shuttle tankers
(US$160.5m). The contracts are scheduled for delivery in 2010 and June 2011
respectively. However, the above is countered by the lapse of a GM5000
semi-submersible rig hull contract awarded in May 07 worth US$202m, due to
the failure of deposit payment. No work has been done for this project. We
believe work on the other offshore projects for which deposits have been
paid has begun, including the GM4000 (US$200m), which is planned for
delivery in 4Q09. Maintain Outperform and target price of S$5.55, based on
sum-of-the-parts valuation.
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