Stock Name: KENCANA
Company Name: KENCANA PETROLEUM BHD
Research House: OSK
KUALA LUMPUR: OSK Research is maintaining its Buy call on Kencana Petroleum and its target price remains unchanged at RM2.06, based on a calendarised PER of 16 times FY11 EPS.
'The stock remains our top pick for the oil and gas (O&G) sector due to its strong delivery track record and reputation in the industry,' said the research house on Tuesday, Oct 26.
To recap, despite the slowdown in new O&G contract awards this year, Kencana's cumulative awards to-date since April 2010 has reached about RM700 million, which represents half of OSK Research's forecast revenue for the company.
OSK Research said Kenanca's order book also has increased to RM1.8 billion (from RM1.6 billion earlier) while its tender book stands at about RM2 billion.
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