PETALING JAYA: The latest contract bagged by Deleum Bhd
from PETRONAS Carigali Sdn Bhd for offshore services will contribute positively to the former’s financial year 2024 (FY24) performance in the duration of the contract, says MIDF Research.
The research firm said the contract win was also in line with robust upstream activities expected this year.
The contract, secured via subsidiary Deleum Technology Solutions Sdn Bhd is worth RM105mil and entails providing offshore maintenance, construction, and modification services for Peninsular Malaysia Assets (Gas Package) throughout 2024.
“The award reflects the positive trajectory anticipated for the upstream oil and gas sector in 2024. Global upstream capital expenditure (capex) is expected to reach US$580bil, while locally, PETRONAS has announced a capex of RM50bil to RM60bil in 2024, of which 40% to 60% is expected to be allocated for the upstream segment,” said MIDF Research.
The research firm said the robust outlook for the upstream division in relation to an elevated yet relatively stable Brent crude oil price will continue to benefit oil and gas services and equipment companies, including Deleum.
“We upgraded our earnings forecast for FY24 and FY25 by 2% and 3% respectively,” it added. In line with the revised forecast, it revised the stock’s target price to RM1.62 (from RM1.58), pegging a price-earnings ratio of 11.2 times to a revised 2024 earnings per share of 14.5 sen.
