Maintain buy with an unchanged fair value (FV) of 55 sen: We have maintained our “buy” call on Sapura Energy Bhd, with an unchanged FV of 55 sen a share, based on a 25% discount to our estimated diluted book value of 73 sen a share, assuming an ex-proposed rights issue of up to RM4 billion. This implies a 24% discount to our ex-sum-of-parts valuation.

Sapura Energy Bhd’s net loss for its third quarter ended Oct 31, 2018 narrowed significantly to RM31.09 million from RM274.41 million a year ago, on higher revenue contribution. Quarterly revenue grew 17.4% to RM1.5 billion from RM1.28 billion previously, the group said in a filing with Bursa Malaysia.

Sapura Energy Bhd and its consortium partner have clinched a RM3 billion contract from Oil and Natural Gas Corporation (ONGC) in India. The consortium partners comprising the group’s wholly-owned subsidiary of Sapura Energy, Sapura Fabrication Sdn Bhd (Sapura Fabrication) and Afcons Infrastructure Limited (Afcons), will be jointly undertaking engineering, procurement, construction, installation and commissioning (EPCIC) works for a central processing platform (CPP) and living quarters for KG-DWN 98/2 NELP block.