Offshore Support Vessels (OSV) - Current Outlook

As three O&G support companies Coastal Contracts, Alam Maritim and Sealink highlighted in previous post involve in Offshore Support Vessels (OSV), it is important to know more about the outlook of the OSV in general.

Below best illustrated the driving force of the demand of OSV and its current scenario.

                                                   Source: Presented at Tugs & Offshore Support Vessels (TOSV) Asia 2010,  

                                                   Kuala Lumpur, Oct 07 & 08, 2010 by Mantrana Maritime Advisory

The oversupply of OSV is still the biggest issue currently which affecting the order of new OSV and the chartering rate. Latest earning reports of Alam Maritim and Tanjung Offshore which mainly deriving their earning through chartering of OSV is disappointing. Although Coastal Contracts, with shipbuilding as their main contributor, announcing a good set of quarterly earning, there are still no announcement of new order received since 2008.

So, would you still bet on these three stocks? Or which of these three would be your best bet? Please exercise your own judgment.

Oil & Gas - Sector in Focus

Would the news below stimulate the oil & gas sector?

Prime Minister Datuk Seri Najib Tun Razak is expected to announce on Nov 30, new development projects as well as several entry point projects (EPPs), that will boost the oil, gas and energy sector.
Read more: Najib to announce ETP projects on Nov 30 http://www.btimes.com.my/Current_News/BTIMES/articles/20101125142859/Article/index_html#ixzz16IkVn500

Malaysia will soon become one of the world's four deepwater oil and gas (O&G)hubs, standing shoulder-to-shoulder with industry leaders like the United States, Brazil and Europe.
Prime Minister Datuk Seri Najib Tun Razak said the Asia-Pacific region has seen increased interest in deepwater development and Malaysia is already at the forefront of this development.
Read more: 'Malaysia to be a global deepwater O&G hub' http://www.btimes.com.my/Current_News/BTIMES/articles/20101125164710/Article/index_html#ixzz16IpJnzN7

After scanning few O&G support company, I found few companies still trade at 52 weeks low. Mind you, there are not loss making money companies but very much in profit. It maybe due to certain fundamental issue or they have been off the radar of investors. Below are the charts (copy from tradesignum.com) of the three companies with their previous earnings reported.

Coastal (Current Price: 2.31)

Alam (Current Price: 1.14)

 

 Sealink (Current Price: 0.615)

It would be too simplistic to decide based on the chart and earning but it do tell a small part of the story for you to continue researching it. Please do check on the business, management, balance sheet, Cash Flow, etc or seek the advise from your investment adviser.