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KUALA LUMPUR: There should be only slight earnings contribution from the long-term charter contracts secured by MISC Bhd from QatarEnergy, said Hong Leong Investment Bank (HLIB) Research, as it maintained its "hold" call on the stock.
In a stock filing yesterday, MISC announced it had secured long-term charter contracts for seven 174,000m3 newbuild liquefied natural gas carriers (LNGC) to be built by Hyundai Heavy Industries.
It said MISC will enter into a consortium with three other MNCs where each member will have an equal equity interest of 25% in each awarded LNGC.
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According to HLIB's back-of-the-envelope estimates, the contract will only improve MISC's FYM25 forecast earnings by less than 3% given it 25% stake in the venture.
"With that, we are only mildly positive on this development. Overall, we maintain 'hold' on MISC with an unchanged SOP-derived TP of RM7.67/share," it said.
Meanwhile, the research firm said the downside is supported for MISC due to the defensive nature of the name due to the portfolio of long-term charters, which will provide consistent, recurring cash flows and the relatively fixed dividend payout policy of 33 sen a year.
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