TGOFF (7228)

bullvsbear

Buying more shares of Tanjung Offshore
Over the past few weeks, we have been slowly increasing our equity weighting, acquiring shares of Resorts World and Bursa Malaysia. We are continuing with this gradual accumulation strategy.

We are buying 15,400 more shares of Tanjung Offshore at last Friday’s closing price of 78 sen — for a total of RM12,012. This will increase our stake from 9,600 shares (at of RM1.57 per share) to 25,000 shares, with an average cost of RM1.085 per share. With this we are 61% equity invested, with sizable cash reserves of RM155,184 for future investments.

The slump in crude oil prices from a high of US$147 (RM524.79) to just above US$50 per barrel has severely dampened sentiment for oil and gas related stocks, most of which have plunged 60%-70% over the past year. There are certainly valid concerns over the prospects and viability of future exploration and other activities if crude oil prices fall too low.

We believe oil prices will not stay low for too long. Inflationary pressures should start to kick in when the impact of the aggressive monetary and fiscal policies start to work through the system. The US dollar is also expected to eventually depreciate. Coupled with Opec cuts, oil prices should trend up again in the second half of the year — although not to previous record levels.

Mirroring the slump in crude oil prices and other oil and gas stocks, Tanjung Offshore’s share price fell from around RM3 at the beginning of 2008 to just 78 sen at present, and offers good value. Despite the oil price slump, its long-term prospects remain positive.

Tanjung Offshore is now a major player in the domestic oil and gas industry, with an expanding marine vessel fleet. From just one vessel in 1995, it now has a fleet of 11 vessels, with five more to be delivered in the next two years. The company is assured of a pool of sustainable earnings over the next few years from its existing vessel charters, maintenance and rig contracts.

The vessels — with lucrative locked in long-term contracts and relatively quick payback periods — will assure Tanjung of steady cash flows and assured earnings. Plus, it will enjoy longer-term growth driven from the ongoing vessel fleet expansion exercise.

We expect net profit to rise 9.3% to RM25.3 million in 2008, 63% to RM41.2 million in 2009 and 25% to RM51.5 million in 2010. At 78 sen, P/E valuations are very attractive at just 4.6 and 3.7 times for 2009-10. The stock even trades 37% below its book value of RM1.23 — despite minimal chances of losses and substantial entry barriers to the industry.

bullvsbear

在O＆G股大涨的时候，TGOFFS还是在底部浮动。TGOFFS迟早要来。可留意。

bullvsbear

在O＆G股大涨的时候，TGOFFS还是在底部浮动。TGOFFS迟早要来。可留意。

YDuncan

为什么放英文的？？？？

bullvsbear

有大脚在压票，在炒高前收更多的票。你压我买。看你能压多久。