CSE GLOBAL LTD
544.SI
CSE Global Limited - Won two contracts worth US$30m
- CSE Global Limited (CSE) announced last Friday that its wholly-owned US subsidiary has won two deepwater offshore projects valued at US$30m (~S$42m) for integrated control systems to be executed in the Gulf of Mexico. The two contracts are slated for execution from 1Q17 to 4Q18.
- As CSE stated that these projects are not expected to have any material impact on FY17 earnings, we expect revenue from these contracts to be mostly recognized in its FY18 results.
- We believe having won these two major contracts could be an indication that its customers in the oil & gas sector may be more inclined to spend on capital expenditure, given higher oil prices compared to a year ago, while its usual brownfield recurring jobs will continue to contribute ~S$60-S$70m per quarter.
- We will closely monitor CSE for any other contract win announcements and will update our assumptions. For now, as we have already provided for project wins in our assumptions, we opt to keep our forecasts unchanged.
- Maintain HOLD with the same FV of S$0.440.
Eugene Chua
OCBC Investment
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http://www.ocbcresearch.com/
2017-03-13
OCBC Investment
SGX Stock
Analyst Report
0.440
Same
0.440
