Asia Pacific Equity Research 16 April 2014
Overweight
Keppel Corporation
KPLM.SI, KEP SP Price: S$11.19
Slightly below-expectation 1Q14 performance on property, but O&M performance remains bright spot
Price Target: S$13.50
1Q14 review: O&M margins remain steady: Keppel Corp. reported a slightly lower-than-expected 1Q14 net profit of S$339mn, down 5% y/y, mainly due to lower contribution from property (1Q14 property is only 14% of FY14 estimates). However, O&M performance remained solid, with operating margins at 14.6% this quarter vs. 14% in 1Q13 and 14.2% in 4Q13. While headline O&M margins were 14.6%, they include a one-off S$6mn gain (on Floatec), so recurring O&M margins were 14.2% this quarter. Overall, 1Q14 net income came in at 23% of our FY14 estimate of S$1504mn. Keppel O&M on track to deliver growth: Keppel’s Sete Brasil semisubs remains on track for delivery, with 60% revenue recognized from the first rig and 20% completion achieved on the second rig (in 1Q14). With the O&M division achieving 26% of our FY14 O&M revenue estimate of S$7.4bn, it remains on track to meet or even potentially beat our FY14 O&M earnings estimate of S$921mn (Socar’s semisub and 2x jackups also hit the 20% revenue recognition threshold in 1Q14). The company is also in advanced stages of negotiations with Golar for an FLNG contract, in discussions with Pemex for yard-related activities in Mexico and in talks with SOCAR in Caspian. Keppel also sees its management contract with Titan Shipyard potentially helping it build a strong presence in the China offshore market. Other key takeaways from results briefing: (1) Options for Petrobras on FPSO and for Ensco on jackups remain valid. (2) The higher tax rate seen this quarter was due to the absence of tax write-backs seen in 1Q13. (3) The weaker infrastructure division year on year was due to the sale of Ecuador business in 1Q13, leading to a reversal of provisions. (4) Expect completion of Manchester’s Phase 1 and Phase II, along with Qatar EPC project, by the end of this year. (4) The Keppel Merlimau plant is generating positive returns. (5) KGreen Trust renamed Keppel Infrastructure Trust. (6) The company has not gone to market for the Can Do Drillship. (7) Acknowledges dayrate reduction in the deepwater segment.
Singapore Conglomerates & Multi-industry Ajay Mirchandani
AC
(65) 6882-2419
[email protected] Bloomberg JPMA MIRCHANDANI
J.P. Morgan Securities Singapore Private Limited
Kumar Gaurav (91-22) 6157-3357 [email protected] J.P. Morgan India Private Limited Price Performance 12.0 11.5 S$ 11.0 10.5 10.0 Apr-13
Jul-13
Oct-13
Jan-14
Apr-14
KPLM.SI share price (S$) FTSTI (rebased)
Abs Rel
YTD 0.0% -2.7%
1m 5.7% 0.5%
3m 2.3% -1.3%
12m -1.4% -0.2%
Price target, valuation, key risks: Our SOTP-based Dec-14 PT of S$13.50 implies 16x 2014E earnings and a 3.3% dividend yield. The key risks to our PT include a worse-than-expected delay in new orders and a collapse in oil prices. Keppel Corporation (Reuters: KPLM.SI, Bloomberg: KEP SP) S$ in mn, year-end Dec FY11A FY12A FY13A Revenue (S$ mn) 10,082 13,965 12,380 Core Profit (S$ mn) 1,491 1,914 1,412 Core EPS (S$) 0.84 1.06 0.78 Core EPS growth (%) 12.9% 27.4% (26.7%) DPS (S$) 0.43 0.45 0.50 P/E (Recurring) 13.4 10.5 14.3 P/BV (x) 2.6 2.2 2.1 ROE (%) 21.1% 22.6% 14.9% Div Yield 3.8% 4.0% 4.4% Source: Company data, Bloomberg, J.P. Morgan estimates.
FY14E 12,464 1,504 0.83 6.5% 0.50 13.5 2.0 15.0% 4.4%
FY15E 14,726 1,717 0.95 14.2% 0.50 11.8 1.8 16.0% 4.4%
Company Data Shares O/S (mn) Market Cap (S$ mn) Market Cap ($ mn) Price (S$) Date Of Price Free Float(%) 3M - Avg daily vol (mn) 3M - Avg daily val (S$ mn) FTSTI Exchange Rate Price Target End Date Price Target (S$)
1,807 20,226 16,149 11.19 16 Apr 14 3.42 36.39 3246.32 1.25 31-Dec-14 13.50
See page 33 for analyst certification and important disclosures, including non-US analyst disclosures. J.P. Morgan does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. www.jpmorganmarkets.com
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Key catalyst for the stock price: • Drillship/FLNG order win • Continued momentum in jackup order wins
Upside risks to our view: • Higher-than-expected margins
Key financial metrics Revenues (S$ mn) Revenue growth (%) EBITDA (S$ mn) EBITDA margin (%) Tax rate (%) Net profit (S$ mn) EPS (S$ ) EPS growth (%) DPS (S$) BVPS (S$) Operating cash flow (S$ mn) Free cash flow (S$ mn) Interest cover (X) Net margin (%) Sales/assets (X) Debt/equity (%) Net debt/equity (%) ROE (%) Key model assumptions Order wins (S$ mn) O&M EBIT Margin %)
FY13A 12,380 -11% 2,377 19% 14% 1,412 0.78 -26% 0.50 5.37 625 (53) 17.1 15% 0.42 52% -11% 15% FY13A 6985 14.7%
FY12A 13,965 39% 2,832 20% 15% 1,914 1.06 28% 0.45 5.14 1,007 (63) 19.4 16% 0.51 53% -23% 23% FY12A 5700 13.5%
FY14E 12,464 1% 2,049 16% 8% 1,504 0.83 7% 0.50 5.70 3,576 3,108 8.2 12% 0.40 48% net cash 15% FY14E 5700 14.0%
Downside risks to our view: • Collapse in oil prices • Worse-than-expected margins • Lower-than-expected order wins
FY15E 14,726 18% 2,396 16% 10% 1,717 0.95 14% 0.50 6.16 2,423 1,871 9.8 12% 0.44 44% net cash 16% FY15E 5985 14.0%
Valuation and price target basis Our Dec-14 PT of S$13.50 is based on our sum-of-the-parts valuation with a DCF-based calculation for the rig-building business and a 12x P/E for the ship repair and other businesses. This is in line with the historical average for the repair business. We value property (Keppel Bay) at NAV and Keppel Land at our PT. Finally, we value the infrastructure business at 1.5x book.
Chart to support valuation and price target Market valuation of listed entities (ex-property) DCF valuation of Offshore & Marine DCF valuation of existing orderbook only Business value of offshore-conversion Ship repair & others DCF valuation of Infrastructure business (ex-Kep T&T) Keppel Bay / other property assets Keppel Land K-REIT Less: Net cash/(debt) -- at O&M level Fair value of Keppel Corp Price target
Source: Bloomberg, Company and J.P. Morgan estimates.
Sensitivity analysis Sensitivity to 5% chg in O&M sales
O&M EBIT FY14E FY15E 5% 5%
0.80 8.04 0.92 6.04 1.08 0.66 0.71 1.73 0.53 0.95 13.43 13.50
Source: Bloomberg, Company and J.P. Morgan estimates.
EPS FY14E FY15E 2.6% 2.7%
JPMe vs. consensus, change in estimates Net Income JPMe old JPMe new % chg Consensus
Source: Bloomberg, Company and J.P. Morgan estimates.
FY14E 1,504 1,504 0% 1,600
FY15E 1,717 1,717 0% 1,723
Source: Bloomberg, Company and J.P. Morgan estimates.
Table 1: Valuation comparison Singapore Keppel Corp SMM Ezion Dyna-Mac Ezra VARD COSCO Corp Malaysia Bumi Armada Sapura Kencana MMHE Dialog UMW Oil & Gas Perisai
Mkt cap (US$ M)
Price (LC)
14E
P/E 15E
14E
P/B 15E
Dividend yield 14E 15E
ROE 14E
16,127 6,834 2,048 325 855 979 1,277
11.14 4.10 2.13 0.41 1.10 1.04 0.72
13.3x 14.2x 9.3x 13.2x 17.8x 9.8x 27.5x
11.7x 13.0x 9.2x 8.8x 11.9x 7.9x 28.1x
1.9x 3.0x 2.3x 2.1x 0.8x 1.6x 1.2x
1.8x 2.7x 1.9x 1.9x 0.7x 1.4x 1.2x
4.0% 4.2% 0.2% 5.3% 0.0% 4.1% 2.8%
4.0% 4.6% 0.2% 8.0% 0.0% 5.0% 2.8%
15.1% 21.9% 26.1% 16.1% 4.4% 16.7% 4.5%
15.9% 21.8% 21.0% 22.9% 6.3% 18.6% 4.4%
3,613 7,955 1,893 2,667 2,578 601
4.01 4.32 3.85 3.57 3.88 1.64
18.7x 16.6x 28.2x 41.7x 27.0x 24.5x
16.4x 14.3x 25.7x 34.5x 21.7x 13.5x
2.5x 2.2x 2.2x 5.8x 2.7x 1.8x
2.3x 1.9x 2.0x 5.2x 2.4x 1.6x
1.1% 0.0% 0.7% 1.0% 0.4% 0.0%
1.2% 0.0% 0.8% 1.2% 0.5% 0.0%
14.4% 14.4% 7.9% 15.8% 10.3% 7.7%
14.6% 14.4% 8.1% 17.3% 11.6% 12.6%
15E
Source: Bloomberg, J.P. Morgan estimates. As of 15 April 2014. *SAKP’s year-end is January; 13E, 14E and 15E represent year-ends of Jan-14, Jan-15 and Jan-16, respectively. Dialog’s year-end is June. 2
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
1Q14 review 1Q14 review: O&M margins remain steady: Keppel Corp. reported a slightly lower-than-expected 1Q14 net profit of S$339mn, down 5% y/y, mainly due to lower contribution from property (1Q14 property is only 14% of FY14 estimates). However, O&M performance remained solid, with operating margins at 14.6% this quarter vs. 14% in 1Q13 and 14.2% in 4Q13. While headline O&M margins were 14.6%, they include a one-off S$6mn gain (on Floatec), so recurring O&M margins were 14.2% this quarter. Overall, 1Q14 net income came in at 23% of our FY14 estimate of S$1504mn. Table 2: Keppel Corp.: 1Q14 versus 1Q13 versus 4Q13 S$ in millions, Year-end Dec Revenue Materials & subcontract costs Staff costs Depreciation & amortization Other operating expenses EBIT Investment income Interest income Interest expense Share of associates/JV profit Exceptionals Profit before tax Tax Net profit Non-controlling interest Attributable net profit Exceptionals Attributable net (recurring)
1Q14 2,996 (2,054) (386) (63) (79) 415 1 36 (26) 66 0 492 (97) 395 (56) 339 0 339
1Q13 2,759 (1,947) (344) (54) (18) 397 3 39 (40) 97 0 496 (72) 424 (67) 357 (26) 331
% y/y 9% 6% 12% 16% 346% 5% -71% -9% -35% -32% na -1% 35% -7% -17% -5% na -5%
4Q13 3,599 (2,603) (543) (64) 358 746 2 19 (8) 350 0 1,109 (103) 1,006 (322) 684 (352) 332
% q/q -17% -21% -29% -2% -122% -44% -59% 94% 239% -81% na -56% -5% -61% -83% -51% na 2%
FY14E 12,464 (8,725) (1,433) (300) (257) 1,748 18 334 (213) 256 0 2,143 (174) 1,970 (466) 1,504 0 1,504
FY13A 12,380 (8,604) (1,668) (242) 268 2,134 14 144 (125) 626 0 2,794 (397) 2,396 (551) 1,846 434 1,412
% y/y 1% 1% -14% 24% -196% -18% 26% 132% 71% -59% na -23% -56% -18% -15% -19% -100% 7%
1Q14 as % of FY14E 24% 24% 27% 21% 31% 24% 5% 11% 12% 26% 23% 56% 20% 12% 23% nm 23%
Source: Company data, J.P. Morgan estimates.
Table 3: Segment breakdown of revenues, operating profit and earnings S$ in millions, Year-end Dec Revenue - O&M - Property - Infrastructure - Investments EBIT (excl. non-recurring) - O&M - Property - Infrastructure - Investments EBIT margin (%) - O&M - Property - Infrastructure - Investments PATMI (recurring) - O&M - Property - Infrastructure - Investments PATMI margin (%) - O&M - Property - Infrastructure - Investments
1Q14 2,996 1,919 329 736 12 415 280 88 48
1Q13 2,759 1,702 298 757 2 371 239 77 39
% y/y 9% 13% 10% -3% 608% 12% 17% 14% 23%
4Q13 3,598 2,071 538 975 14 474 294 270 -93
% q/q -17% -7% -39% -25% -14% -12% -5% -67% -152%
FY14E 12,464 7,409 1,669 3,377 10 1,748 1,038 637 73
FY13A 12,380 7,126 1,768 3,459 27 1,774 1,044 666 39
% y/y 1% 4% -6% -2% -63% -1% -1% -4% 87%
1Q14 as % of FY14E 24% 26% 20% 22% 120% 24% 27% 14% 66%
-1 13.9% 14.6% 26.7% 6.5% -8.3% 339 231 62 32 14 11.3% 12.0% 18.8% 4.3% 116.7%
16 13.4% 14.0% 25.8% 5.2% 944.5% 331 208 81 27 15 12.0% 12.2% 27.2% 3.6% 881.1%
-106%
3 13.2% 14.2% 50.2% -9.5% 21.4% 332 270 156 (111) 17 9.2% 13.0% 29.0% -11.4% 121.4%
-133%
0 14.0% 14.0% 38.2% 2.2% 0.0% 1,504 921 437 120 25 12.1% 12.4% 26.2% 3.6% 246.8%
25 14.3% 14.7% 37.7% 1.1% 92.6% 1,412 930 442 (14) 54 11.4% 13.1% 25.0% -0.4% 200.0%
-100%
nm
7% -1% -1% -960% -54%
23% 25% 14% 27% 57%
-5% 11% -23% -40% -6%
2% -14% -60% -129% -18%
Source: Company data, J.P. Morgan estimates. 3
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
O&M operating margins remain steady Figure 1: O&M segment - EBIT margin %, Year-end Dec 30.0%
26.0%
26.7%
25.0%
24.2% 19.7%
20.0% 15.0%
16.2%
13.8%
11.8%
12.8%
2Q09
3Q09
21.0%
20.7%
19.0%
15.1%
16.5%
12.9%
12.9%
13.2%
10.4%
14.0%14.2%
14.2%
14.6%
4Q13
1Q14
10.0% 5.0% 0.0% 1Q09
4Q09
1Q10
2Q10
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
Source: Company data.
Figure 2: Keppel: Historical quarterly new order wins S$ in millions, Year-end Dec
7300
8,000 7,000 6,000 4,500
5,000 4,000
2,760 2,318 2,173
3,000 2,000 1,000
3,564
3,491 2,659
2,865
2,700
1,600 1,600 1,441 1,308 1,200 1,200 924600 1,035 646 700 316 315 30 85 50 358
9291,194 248529
1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14
-
1590 1,200 688812
2140 1660 1900 1900 1100 1300
Source: Company data, J.P. Morgan estimates.
Figure 3: Keppel: Historical annual new order wins
Figure 4: Keppel: Historical net orderbook
S$ in billions, Year-end Dec
S$ in billions, Year-end Dec
12.0
16 10
10.0 8.0
6.5
7.4
7.0
10.5
10.8 9.4
10 7.2
8
5.6
6
3.2
4
1.9
1.7
12.8
12.2
12
3.1
2.0
14.2 14.4
14
5.2
6.0 4.0
7.3
10
2
3.4
4.6
1.9
0
-
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 1Q14
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 1Q14 Source: Company data.
Source: Company data.
Table 4: Recurring earnings breakdown S$ in millions, %, Year-end Dec PATMI (recurring) - O&M - Property - Infrastructure - Investments
FY09 1,265 810 209 126 119
Source: Company data, J.P. Morgan estimates. 4
FY10 1,307 987 214 57 49
FY11A 1,491 1,064 300 82 45
FY12A 1,914 937 784 (1) 194
FY13A 1,412 930 442 -14 54
FY14E 1,504 921 437 120 25
FY15E 1,717 1,136 436 119 27
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Table 5: Keppel: Orders won in 2013 Date of award 26-Feb-13
Customer (a) MODEC-Toyo, (b) SBM
Vessel type FPSO integration and internal turret
27-Feb-13
(a) Star Drilling, (b) Ensco, (c) Diamond
1x jackup, upgrade of 2x semisubs
28-Mar-13 9-Apr-13 15-Apr-13 04-Jun-13 03-Jul-13
Grupo R Ensco Falcon Energy Caspian Drilling PV Drilling
4x jackups 1x jackup 1x jackup 1x semisub 1x jackup
15-Jul-13 2-Aug-13
Grupo R Parden Holdings
1x jackup 1x jackup
20-Aug-13
Floatel International
18-Sep-13
(a) SBM Offshore, (b) M3energy Offshore
1-Oct-13 11-Oct-13
Clearwater Perforadora Central
7-Nov-13 21-Nov-13 16-Dec-13
Transocean Ensco Bumi Armada, Apache, Emas
1x semisub accommodation FPSO conversion 2x jackups 1x jackup 5x jackups 1x jackup FPSO, FSO conversion/repair
Description (a) A contract from Modec-Toyo JV to integrate topside modules of a FPSO unit. The project will be carried out at Keppel BrasFels. (b) Contract from SBM Offshore to fabricate an internal turret for a newbuild FPSO to be installed in the Ichthys field off Western Australia (a) Construction of a jackup rig for Star Drilling (promoted by India’s DP Jindal Group). (b) Upgrade of semisubmersible Ensco 5006 for Ensco. (c) Upgrade of semisubmersible Ocean Patriot for Diamond Offshore Jackup contract from Mexico’s Grupo R Repeat jackup order from Ensco Jackup order from Falcon Energy Group Contract to build 1 semisub with delivery scheduled in 4Q16 Jackup contract from PV Drilling Overseas with delivery scheduled in 1Q15 Jackup order from Grupo R, with delivery scheduled in 4Q15 Jackup order from Uruguay’s Parden Drilling with delivery in 4Q15. The rig will operate in offshore Mexico Order for a semisub accommodation vessel that can accommodate 500 people with delivery in 4Q15 FPSO conversion job from repeat customers. SBM’s FPSO to be used for Shell’s Mexico project. M3energy’s FPSO to be used in Indonesia Order for 2x jackups with delivery in 4Q15 and 1Q16, respectively Order for 1x jackup with delivery in 4Q15. The jackup will operate in Mexican markets Transocean orders 5+5 jackups with delivery from 1Q16 to 3Q17 Scheduled for delivery in 2Q16 Secured orders worth US$150mn in five contracts for FPSO and FSO conversion, upgrade and repair works
Total value
Value (US$ M) 160
Value (S$ M) 200
300
371
820 225 226 800 210
1,013 278 279 1000 263
206 206
258 258
280
350
152
190
440 240
550 300
1100 265 150
1375 331 187.5
~5.78bn
~7.1bn
Value (US$ M) 218
Value (S$ M) 277
650
826
500 110
635 140
~1.47bn
~1.87bn
Source: Company data, J.P. Morgan estimates.
Table 6: Keppel: Orders won in 2014 (YTD) Date of award 06-Feb-14
Customer UMW Oil & Gas
13-Feb-14
Fecon International
3-Mar-14 17-Mar-14
TS Offshore SOFEC, Bumi Armada, KSP Towage
Total value
Vessel type 1x jackup 3x jackups 1x jackups FPSO fabrication, ice class vessels
Description Contract from UMW Oil & Gas to build 1 KFELS B Class jackup. Delivery scheduled in 3Q15 Order from Fecon International (backed by AP Dobrov) for 3x jackups with delivery progressively within 2H16 Order for 1 ultra-high-spec jackup with delivery scheduled in 1Q17 FPSO fabrication from SOFEC, two ice class vessels from Bumi Armada, two tugs from KSP Towage
Source: Company data, J.P. Morgan estimates.
5
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Global rig data Global rig orders by key yards and vessel type since 2004 (Data presented as of March 13, 2014) Table 7: Global jackup orders No. of rigs Keppel SMM Daewoo Hyundai Samsung Chinese Yards Others Total
2004 5 3 0 0 0 1 0 9
2005 19 8 0 0 0 3 4 34
2006 10 5 0 0 0 1 7 23
2007 8 6 0 0 0 6 11 31
2008 3 6 0 0 0 8 4 21
2009 0 1 0 0 0 1 1 3
2010 5 6 0 0 0 5 5 21
2011 23 7 0 0 0 10 4 44
2012 5 4 0 0 0 10 3 22
2013 19 8 1 0 2 38 6 74
2014 5 1 0 0 0 5 1 12
2004 0 0 0 0 0 0 0
2005 3 3 1 0 1 3 11
2006 5 1 3 0 1 10 20
2007 1 2 2 0 2 4 11
2008 4 4 1 0 0 1 10
2009 0 0 1 0 0 0 1
2010 0 0 0 0 0 0 0
2011 1 0 2 0 0 3 6
2012 5 1 3 2 0 1 12
2013 1 0 0 1 2 4 8
2014 0 0 0 0 0 3 3
Source: Riglogix.
Table 8: Global semisub orders No. of rigs Keppel SMM Daewoo Hyundai Samsung Others Total Source: Riglogix.
Table 9: Global drillship orders No. of rigs Keppel SMM Daewoo Hyundai Samsung Others Total
2004 0 0 0 0 0 0 0
2005 0 0 0 0 2 0 2
2006 0 0 3 0 6 1 10
2007 1 0 3 1 11 0 16
2008 0 0 7 2 10 2 21
2009 0 0 0 0 0 0 0
2010 0 0 0 0 3 1 4
2011 0 0 5 11 10 9 35
2012 0 7 5 2 9 10 33
2013 0 0 6 0 5 0 11
2014 0 2 0 0 0 0 2
2007 2 2 5 1 13 4 27
2008 4 4 8 2 10 3 31
2009 0 0 1 0 0 0 1
2010 0 0 0 0 3 1 4
2011 1 0 7 11 10 12 41
2012 5 8 8 4 9 11 45
2013 1 0 6 1 7 4 19
2014 0 2 0 0 0 3 5
Source: Riglogix.
Table 10: Global deepwater rigs (semis plus drillships) orders No. of rigs Keppel SMM Daewoo Hyundai Samsung Others Total Source: Riglogix.
6
2004 0 0 0 0 0 0 0
2005 3 3 1 0 3 3 13
2006 5 1 6 0 7 11 30
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Global rig deliveries by key yards and vessel type since 2004 Table 11: Global jackup deliveries No. of rigs Keppel SMM Daewoo Hyundai Samsung Chinese Yards Others Total
2004 0 0 0 0 1 0 3 4
2005 1 0 0 0 0 0 2 3
2006 5 2 0 0 0 1 1 9
2007 8 4 0 0 0 1 1 14
2008 13 10 0 0 0 4 2 29
2009 9 5 0 0 0 5 6 25
2010 7 4 0 0 0 5 4 20
2011 3 4 0 0 0 3 5 14
2012 3 3 0 0 0 2 9 17
2013 21 7 0 0 0 7 3 38
2014 0 3 0 0 0 1 2 6
2004 0 0 0 0 0 2 2
2005 0 0 0 0 0 2 2
2006 0 0 0 0 0 0 0
2007 0 0 0 0 0 0 0
2008 1 2 1 0 1 0 5
2009 5 3 3 0 1 5 17
2010 3 3 2 0 0 4 12
2011 2 3 1 0 2 7 15
2012 2 1 1 0 0 4 8
2013 0 0 0 0 0 1 1
2014 0 0 0 0 0 0 0
Source: Riglogix.
Table 12: Global semisub deliveries No. of rigs Keppel SMM Daewoo Hyundai Samsung Others Total Source: Riglogix.
Table 13: Global drillship deliveries No. of rigs Keppel SMM Daewoo Hyundai Samsung Others Total
2004 0 0 0 0 0 0 0
2005 0 0 0 0 0 0 0
2006 0 0 0 0 0 0 0
2007 0 0 0 0 0 0 0
2008 0 0 0 0 4 0 4
2009 0 0 3 0 3 0 6
2010 0 0 3 1 8 0 12
2011 2 0 3 2 9 1 17
2012 0 0 3 0 5 0 8
2013 0 0 2 2 7 1 12
2014 0 0 1 3 2 1 7
2007 0 0 0 0 0 0 0
2008 1 2 1 0 5 0 9
2009 5 3 6 0 4 5 23
2010 3 3 5 1 8 4 24
2011 4 3 4 2 11 8 32
2012 2 1 4 0 5 4 16
2013 0 0 2 2 7 2 13
2014 0 0 1 3 2 1 7
Source: Riglogix.
Table 14: Global deepwater rigs (semis plus drillships) deliveries No. of rigs Keppel SMM Daewoo Hyundai Samsung Others Total
2004 0 0 0 0 0 2 2
2005 0 0 0 0 0 2 2
2006 0 0 0 0 0 0 0
Source: Riglogix.
7
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Global rig prices by key yards and vessel type since 2004 Table 15: Average contract prices for jackups by company $ in millions 2004 118 120 n/a n/a n/a 135 n/a n/a n/a
Keppel SMM Daewoo Hyundai Samsung Dalian ABG MIS Lamprell
2005 130 131 n/a n/a n/a 152 n/a n/a n/a
2006 184 159 n/a n/a n/a n/a n/a n/a n/a
2007 234 228 n/a n/a n/a n/a 220 168 172
2008 213 218 n/a n/a n/a 250 n/a 182 168
2009 n/a 195 n/a n/a n/a n/a n/a n/a n/a
2010 179 203 n/a n/a n/a 195 220 n/a 185
2011 234 268 n/a n/a n/a 209 n/a n/a 165
2012 303 223 n/a n/a n/a n/a n/a n/a 187
2013 225 259 650 n/a 650 230 n/a n/a n/a
2014 n/a n/a n/a n/a n/a n/a n/a n/a n/a
2006 364 480 499 n/a 542 550 n/a 300
2007 427 528 639 n/a 575 450 560 310
2008 499 664 633 n/a n/a n/a n/a n/a
2009 n/a n/a 385 n/a n/a n/a n/a n/a
2010 n/a n/a n/a n/a n/a n/a n/a n/a
2011 809 n/a 565 n/a n/a n/a n/a n/a
2012 824 650 587 695 n/a n/a n/a n/a
2013 n/a n/a n/a 755 800 n/a n/a 650
2014 n/a n/a n/a n/a n/a n/a n/a n/a
2006 n/a n/a 645 n/a 616 n/a n/a
2007 n/a n/a 691 740 660 n/a n/a
2008 n/a n/a 581 652 612 585 n/a
2009 n/a n/a n/a n/a n/a n/a n/a
2010 n/a n/a n/a n/a 600 550 n/a
2011 n/a n/a 597 618 609 n/a 662
2012 n/a 804 727 638 518 n/a n/a
2013 n/a 806 625 n/a 609 n/a n/a
2014 n/a 0 n/a n/a n/a n/a n/a
Source: Riglogix
Table 16: Average contract prices for semisubs by company $ in millions 2004 n/a n/a n/a n/a n/a n/a n/a n/a
Keppel SMM Daewoo Hyundai Samsung IMAC Cosco CIMC
2005 260 451 512 n/a 502 n/a n/a 285
Source: Riglogix
Table 17: Average contract prices for drillships by company $ in millions 2004 n/a n/a n/a n/a n/a n/a n/a
Keppel SMM Daewoo Hyundai Samsung STX EAS
2005 n/a n/a n/a n/a 539 n/a n/a
Source: Riglogix
Table 18: Average contract prices for deepwaters (drillships and semisubs) by company $ in millions Keppel SMM Daewoo Hyundai Samsung IMAC Cosco CIMC STX EAS Source: Riglogix
8
2004 n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a
2005 260 451 512 n/a 527 n/a n/a 285 n/a n/a
2006 364 480 572 n/a 605 550 n/a 300 n/a n/a
2007 427 528 670 740 647 450 560 310 n/a n/a
2008 499 664 591 652 612 n/a n/a n/a 585 n/a
2009 n/a n/a 385 n/a n/a n/a n/a n/a n/a n/a
2010 n/a n/a n/a n/a 600 n/a n/a n/a 550 n/a
2011 809 n/a 588 618 609 n/a n/a n/a n/a 662
2012 824 785 675 666 518 n/a n/a n/a n/a n/a
2013 n/a 806 625 755 663 n/a n/a 650 n/a n/a
2014 n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Historical global rig deliveries and orders Figure 5: Rig deliveries No. of rigs Jackup
120 110
Semisub
Drillship
96
100
77
90 80
63
70 60
38
50
36
40 20 10
47 33
51
37
27 22
12
45
44
21 12
9
15 9
4 4
7 8 3 2 3 3 3 0
2
19
15
14
8
8
0 0
5 4 6 5
9
7
4
1 0 0
1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
0
42
22 26
30
47
Source: Riglogix.
Figure 6: Rig orders (1971-2014 YTD) No. of rigs Jackup
150 140
Semisub
Drillship
127
130 120 85
110 100
66
94
90 80 60
21
30
19
20 6
26
22
19
16 7
17
16
12
10 4
4 0 2 2 0 0 0
1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993
0
6
52
58
0 2
5 0
9 3 3
9
4 25
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
40
47
38
34 32 30
50
10
52
61
70
Source: Riglogix.
9
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Global rig fleet by water depth Table 19: Global jackup fleet 0-199 ft 200-299 ft 300-399 ft >400 ft Total jackups y/y change % Cold stacked jackups 0-199 ft 200-299 ft 300-399 ft >400 ft Total cold & ready stacked jackups
2004 49 135 172 22 378
2005 53 138 170 23 384 1.6%
2006 56 137 177 26 396 3.1%
2007 54 138 187 30 409 3.3%
2008 54 134 210 34 432 5.6%
2009 51 132 229 37 449 3.9%
2010 49 135 242 40 466 3.8%
2011 51 134 250 46 481 3.2%
2012 47 124 255 51 477 -0.8%
2013 47 122 267 75 511 7.1%
2014 47 123 268 79 517 1.2%
16 16 4 1
12 12 3 8
14 14 4 4
19 19 7 2
18 18 7 3
52 52 49 5
55 55 60 6
45 45 47 1
23 23 32 3
23 23 34 4
33 33 39 9
37
35
36
47
46
158
176
138
81
84
114
2004 68 34 25 23 15 165
2005 66 33 25 25 15 164 -0.6%
2006 67 34 25 25 16 167 1.8%
2007 67 34 25 25 16 167 0.0%
2008 67 34 25 25 21 172 3.0%
2009 66 34 25 26 36 187 8.7%
2010 65 35 25 26 46 197 5.3%
2011 65 36 25 26 59 211 7.1%
2012 65 38 25 26 65 219 3.8%
2013 65 38 25 26 66 220 0.5%
2014 65 38 25 26 66 220 0.0%
21 3 4 4 3
7 2 1 2 1
4 2 0 0 0
4 1 0 0 0
6 1 0 1 0
13 4 1 1 0
18 3 5 3 1
17 4 5 1 0
16 3 4 0 0
14 4 5 1 0
16 6 5 3 0
35
13
6
5
8
19
30
27
23
24
30
2004 4 4 7 7 15 37
2005 4 5 7 7 15 38 2.7%
2006 4 5 7 7 15 38 0.0%
2007 3 5 7 7 15 37 -2.6%
2008 3 5 7 7 19 41 10.8%
2009 3 5 7 7 25 47 14.6%
2010 3 5 7 7 37 59 25.5%
2011 3 5 7 7 54 76 28.8%
2012 3 5 7 6 62 83 9.2%
2013 3 5 7 6 74 95 14.5%
2014 3 5 7 6 81 102 7.4%
3 0 4 1 0
1 0 1 1 0
1 0 0 0 0
1 0 0 0 0
0 0 0 0 0
0 0 1 0 0
1 0 2 1 0
1 0 2 1 0
3 0 3 0 1
2 0 3 0 1
1 0 4 0 1
8
3
1
1
0
1
4
4
7
6
6
Source: Riglogix. 2014 is YTD number.
Table 20: Global semisub fleet 0-2999 ft 3000-3999 ft 4000-5999 ft 6000-7499 ft > 7500 ft Total semisubs y/y change % Cold stacked semisubs 0-2999 ft 3000-3999 ft 4000-5999 ft 6000-7499 ft > 7500 ft Total cold & ready stacked semisubs
Source: Riglogix. 2014 is YTD number.
Table 21: Global drillship fleet 0-2999 ft 3000-3999 ft 4000-5999 ft 6000-7499 ft > 7500 ft Total drillships y/y change % Cold stacked drillships 0-2999 ft 3000-3999 ft 4000-5999 ft 6000-7499 ft > 7500 ft Total cold & ready stacked drillships
Source: Riglogix. 2014 is YTD number.
10
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Dayrates by rig type Figure 7: Worldwide jackup dayrates by water depth
Table 22: Jackup dayrates by region
US$
US$
$210,000
$186,102
$160,000
$130,073
Current month 1 year ago 2 years ago
World wide
U.S. GOM
North Sea
Mideast Persian
SE Asia
$133,259 $121,039 $108,196
$120,188 $97,914 $73,419
$207,277 $194,172 $168,240
$112,198 $101,679 $106,127
$147,676 $132,236 $117,256
$133,000 Source: Riglogix. As of Mar-14.
$110,000
$100,774 $60,000
$76,232
$10,000 Mar-02
Mar-04 Mar-06 0-199 ft >400 ft
Mar-08 Mar-10 200-299 ft All Depths
Mar-12 Mar-14 300-399 ft
Source: Riglogix. As of Mar-14.
Figure 8: Worldwide semisub dayrates by water depth
Table 23: Semisub dayrates by region
US$
US$
$520,000 $459,943 $470,000 $430,600 $420,000 $351,569 $370,000 $320,000 $396,678 $270,000 $339,669 $220,000 $327,963 $170,000 $120,000 $70,000 $20,000 Mar-02 Mar-04 Mar-06 Mar-08 Mar-10 Mar-12 Mar-14 All depths
<2000 ft
2000-3999 ft
4000-5999 ft
6000-7999 ft
>8000 ft
Current month 1 year ago 2 years ago
World wide
U.S. GOM
North Sea
Brazil
West Africa
$396,678 $364,265 $359,052
$471,741 $464,878 $451,724
$401,983 $387,530 $365,581
$351,463 $318,008 $321,277
$480,712 $413,030 $387,553
Source: Riglogix. As of Mar-14.
Source: Riglogix. As of Mar-14.
Figure 9: Worldwide drillship dayrates by water depth
Table 24: Drillship dayrates by region
US$
US$
$527,767 $491,795 $368,333
$520,000 $420,000 $220,000
$302,807 $290,667
$120,000
$151,000
$320,000
Current month 1 year ago 2 years ago
World wide
U.S. GOM
North Sea
Brazil
West Africa
$491,795 $475,761 $443,475
$546,815 $532,403 $504,571
$557,816 $557,816 $557,816
$404,210 $402,684 $376,634
$530,563 $492,377 $470,658
Source: Riglogix. As of Mar-14.
$20,000 Mar-02 Mar-04 Mar-06 Mar-08 Mar-10 Mar-12 Mar-14 All depths
<2000 ft
2000-3999 ft
4000-5999 ft
6000-7999 ft
>8000 ft
Source: Riglogix. As of Mar-14.
11
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Utilization by rig type Figure 10: Worldwide jackup utilization by water depth
Table 25: Jackup utilization by region
100.0% 81.0% 82.84% 78.3%
90.0% 80.0% 70.0%
73.9% 72.34%
60.0%
Current month 1 year ago 2 years ago
World wide
U.S. GOM
North Sea
Mideast Persian
SE Asia
West Africa
78.3% 79.1% 73.7%
55.4% 60.3% 54.9%
89.4% 95.3% 88.4%
78.7% 78.2% 80.2%
86.3% 81.4% 69.7%
71.4% 75.8% 65.7%
Source: Riglogix.
50.0% Mar-02 Mar-04 Mar-06 Mar-08 Mar-10 Mar-12 Mar-14 All depths
0-199 ft
200-299 ft
300-399 ft
>400 ft
Source: Riglogix.
Figure 11: Worldwide semisub utilization by water depth
Table 26: Semisub utilization by region
100.0%
96.97% 73.08% 81.82% 72% 71.0% 80.05%
90.0% 80.0% 70.0%
Current month 1 year ago 2 years ago
World wide
U.S. GOM
North Sea
Brazil
West Africa
81.8% 84.9% 79.1%
73.3% 73.3% 65.4%
97.9% 89.4% 88.1%
100.0% 98.1% 94.8%
63.6% 85.7% 81.0%
Source: Riglogix.
60.0% 50.0% Mar-02
Mar-04 Mar-06 Mar-08 Mar-10 Mar-12
Mar-14
All depths
<2000 ft
2000-3999 ft
4000-5999 ft
6000-7999 ft
>8000 ft
Source: Riglogix.
Figure 12: Worldwide drillship utilization by water depth
Table 27: Drillship utilization by region
92.5%
100% 86.9% 80% 66.7% 57.1%
95.0% 75.0% 55.0% 35.0%
15.0% Mar-02 Mar-04 Mar-06 Mar-08 Mar-10 Mar-12 Mar-14 All depths
<2000 ft
2000-3999 ft
4000-5999 ft
>8000 ft
6000-7999 ft
Source: Riglogix.
12
Current month 1 year ago 2 years ago Source: Riglogix.
World wide
U.S. GOM
North Sea
Brazil
West Africa
89.2% 88.1% 80.8%
80.0% 89.5% 76.9%
100.0% 100.0% 100.0%
100.0% 100.0% 70.8%
86.2% 85.7% 92.9%
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Future delivery schedule Figure 13: Jackup delivery schedule No. of rigs
60 50 40 53
30 27
20
20
10
10
0
2014
4
4
2015
2016
Contracted Jack-ups
0 5 2017
Uncontracted Jack-ups
Source: Riglogix, J.P. Morgan.
Figure 14: Semisub delivery schedule No. of rigs
10 8 3
6 4 2
7
2 5
3
2
2
0 2014
2015
2016
1
2
1
2017
2018
2019
Contracted Semisubs
0 2020
Uncontracted Semisubs
Source: Riglogix, J.P. Morgan.
Figure 15: Drillship delivery schedule No. of rigs
25 20
12
15 14
10 5
10
2 10
4
0 2014
2015
2016
6
4
3
2017
2018
2019
Contracted Drillships
1 2020
0 2021
Uncontracted Drillships
Source: Riglogix, J.P. Morgan.
13
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Aging analysis Table 28: Aging analysis of jackups by water depth No. of rigs 0-5 yrs 5-10 yrs 10-15 yrs 15-20 yrs 20-25 yrs 25-30 yrs More than 30 yrs Total delivered rigs Under construction Total
0-199 ft 3 2 2 0 0 1 47 55 1 56
200-299 ft 7 0 0 1 0 3 112 123 3 126
300-399 ft 59 48 3 1 8 19 128 266 31 297
More than 400 ft 45 13 13 2 1 3 2 79 88 167
Total 114 63 18 4 9 26 289 523 123 646
Source: Riglogix, J.P. Morgan.
Table 29: Aging analysis of semisubs by water depth No. of rigs 0-5 yrs 5-10 yrs 10-15 yrs 15-20 yrs 20-25 yrs 25-30 yrs More than 30 yrs Total delivered rigs Under construction Total
0-2999 ft 4 0 2 0 2 13 66 87 7 94
3000-3999 ft 1 0 1 0 2 1 11 16 1 17
4000-5999 ft 0 2 3 1 0 6 13 25 4 29
6000-7499 ft 0 0 3 3 1 4 8 19 0 19
More than 7500 ft 41 14 11 1 0 2 4 73 16 89
Total 46 16 20 5 5 26 102 220 28 248
4000-5999 ft 0 0 0 0 0 0 7 7 2 9
6000-7499 ft 0 0 0 0 0 0 4 4 0 4
More than 7500 ft 62 4 14 2 0 0 1 83 66 149
Total 62 4 14 2 0 2 18 102 68 170
Source: Riglogix, J.P. Morgan.
Table 30: Aging analysis of drillships by water depth No. of rigs 0-5 yrs 5-10 yrs 10-15 yrs 15-20 yrs 20-25 yrs 25-30 yrs More than 30 yrs Total delivered rigs Under construction Total Source: Riglogix, J.P. Morgan.
14
0-2999 ft 0 0 0 0 0 1 5 6 0 6
3000-3999 ft 0 0 0 0 0 1 1 2 0 2
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Aging analysis of key owners Figure 16: Aging analysis of jackups owned by major customers
Figure 17: Aging analysis of deepwater rigs (semisubs and drillships) owned by major customers
No. of vessels
< 25 years
100
60 40 20 0
40 33
4 29 5
Source: Riglogix,
36 20
2 12 14
3 3 4
3
13 18 Seadrill
20
Rowan
18
Atwood Oceanics
6
Underconstruction
8
Noble Drilling
80
> 25 years
ENSCO+Prid e
0 5 0
Diamond Offshore
9
39
Transocean
12
Seadrill
ENSCO+Pride
61
Diamond Offshore
52 10
30 12
4
Rowan
3
No. of vessels
Underconstruction
Atwood Oceanics
> 25 years
Noble Drilling
< 25 years
Transocean
60 50 40 30 20 10 0
Source: Riglogix, J.P. Morgan.
Figure 18: Water depth analysis of jackups owned by major customers Figure 19: Water depth analysis of deepwater rigs (semisubs and drillships) owned by major customers No. of vessels No. of vessels
00
0
10 0 0
41
27
24
19 10
14 13
31 10 6 4
4
31
4
0
0
Seadrill Ltd
20 1
29
14
Rowan
5 42
38
Atwood Oceanics
Source: Riglogix, J.P. Morgan.
0
13 3
19
38
>8000 ft
Noble Drilling
0
0 19
10
<8000 ft
ENSCO+Pride
0
0 7
23
29
79
Diamond Offshore
11 51
7
30
90 80 70 60 50 40 30 20 10 0
Transocean Ltd.
0
12
ENSCO+Prid e
10
17
Diamond Offshore
20
14
Transocean Ltd.
30
49 10
More than 400 ft
Seadrill Ltd
40
45
300 - 399 ft
Rowan
50
200 - 299 ft
Atwood Oceanics
0 - 199 ft
Noble Drilling
60
Source: Riglogix, J.P. Morgan.
15
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Aging analysis of key owners for cold & ready stacked rigs Figure 20: Aging analysis of cold & ready stacked jackups owned by major customers
Figure 21: Water depth analysis of cold & ready stacked jackups owned by major customers
No. of vessels
No. of vessels
3 2
0
Seadrill 0
2
1 2
Transocean Ltd.
0
0
Atwood Oceanics
Noble Drilling
ENSCO+Prid e
0
1 0 1
1
2
1
3
2
2
Rowan
2 Diamond Offshore
0
1 Transocean
1
3
5
More than 300 ft
0
1
1
1
0
00 0
0 0
1
Seadrill Ltd
4
200 5 - 299 ft
Atwood Oceanics
4
0 - 199 ft
Noble Drilling
5
Rowan
6
5
ENSCO+Prid e
> 25 years
Diamond Offshore
< 25 years
6
0
Source: Riglogix.
Source: Riglogix.
Figure 22: Aging analysis of cold & ready stacked semisubs owned by major customers
Figure 23: Water depth analysis of cold & ready stacked semisubs owned by major customers
No. of vessels
No. of vessels
0 - 2999 ft 4000 - 5999 ft More than 7500 ft
20 16 15 4
0 3
3
0 01
2
1 0
1
0
0
0
0
0
Seadrill Ltd
Seadrill
5
Rowan
0
0
5
Atwood Oceanics
0
Rowan
0
1 0
Atwood Oceanics
1
2
Noble Drilling
2
ENSCO+Pride
Diamond Offshore
3
5
4
Transocean Ltd.
5
Diamond Offshore
10
13
3000 - 3999 ft 6000 - 7499 ft
Noble Drilling
> 25 years
ENSCO+Pride
< 25 years
Transocean
18 16 14 12 10 8 6 4 2 0
Source: Riglogix.
Source: Riglogix.
Figure 24: Aging analysis of cold & ready stacked drillships owned by major customers
Figure 25: Water depth analysis of cold & ready stacked drillships owned by major customers
No. of vessels
No. of vessels
2
Source: Riglogix.
16
0
00 0
Source: Riglogix.
00 0
0 0 0
00
00
00
00 Seadrill Ltd
0 Seadrill
0
Rowan
0
Atwood Oceanics
0
Noble Drilling
0
ENSCO+Pride
Diamond Offshore
Transocean
0
00
Noble Drilling
0.2
ENSCO+Pride
0.4
1
1
Rowan
1
Transocean Ltd.
0.6
3000 - 3999 ft 6000 - 7499 ft
Atwood Oceanics
1 0.8
0
0 - 2999 ft 4000 - 5999 ft More than 7500 ft
3
> 25 years
Diamond Offshore
< 25 years
1.2
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
“Contracted vs. un-contracted” under-construction rigs Figure 26: “Contracted vs. un-contracted” under-construction jackups No. of vessels
140
123
120
104
100 80 60
78 67
58 51
76
71 54
49 34
40 20
0
0
7
Dec-06
2
9
Dec-07
2
15
Dec-08
Total Underconstruction
54
47 33 13
68
Dec-09
Dec-10
2
Contracted
16
46 29 6
Dec-11
Uncontracted
101 84
81
6 Dec-12
18
17 3
4
Dec-13
Mar-14
Contracted Unavailable
Source: Riglogix.
Figure 27: “Contracted vs. un-contracted” under-construction semisubs No. of vessels
60
5150
4645
50
3535
40 30
2423
20
18 14
1412
10
01
01
00
00
20
Dec-07
Dec-08
Dec-09
Dec-10
Dec-11
01
0
Dec-06
Total Underconstruction
Contracted
28
25
2323
Uncontracted
14 11 4
1414
0
0
0
Dec-12
Dec-13
Mar-14
Contracted Unavailable
Source: Riglogix.
Figure 28: “Contracted vs. un-contracted” under-construction drillships No. of vessels
80 70 60 50 40 30 20 10 0
74
4341 2827
68
55
49 42
3735
70
41
3129
38 30
29 19
76
10
10
20
20
20
Dec-06
Dec-07
Dec-08
Dec-09
Dec-10
Total Underconstruction
Contracted
7
0
0
0
0
Dec-11
Dec-12
Dec-13
Mar-14
Uncontracted
Contracted Unavailable
Source: Riglogix.
17
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Un-contracted under-construction jackups Table 31: Un-contracted jackup deliveries Delivery year 2015
Max WD (in ft) 400
Delivery date Jun-15
Order date Jan-13
400
Sep-15
May-13
350
Apr-15
Jan-13
350
Jul-15
Jan-13
350
Oct-15
Sep-13
CMHI Shipyard, China
350
Dec-15
Nov-13
Central Shipping Monaco Jackup TBN 1 Central Shipping Monaco Jackup TBN 2 COSL 943
CIMC Raffles, China
400
Dec-15
Jan-14
CIMC Raffles, China
400
Dec-15
Jan-14
FG Offshore
Dalian Shipyard, China
400
Sep-15
Oct-13
COSL 944
Dalian Shipyard, China
400
Oct-15
Oct-13
Clearwater Jackup TBN 1 Clearwater Jackup TBN 2 CPOE-16 CPOE-17
Keppel FELS, Singapore
400
Oct-15
Oct-13
Dalian Shipyard Dalian Shipyard Keppel Fels
Keppel FELS, Singapore
400
Feb-16
Oct-13
Keppel Fels
Shanghai Waigaoqiao, China Dalian Shipyard, China
400 400
Apr-14 Dec-15
Mar-12 Oct-13
Coastal Contracts Jackup TBN 1 Coastal Contracts Jackup TBN 2 CP400-1
CIMC Raffles, China
400
Nov-14
41409
CIMC Raffles, China
400
Jun-16
Nov-13
China Petroleum Liaohe Equipment, China Drydocks World Graha, Batam, Indonesia Drydocks World Graha, Batam, Indonesia Drydocks World, Dubai
400
Apr-14
Jan-12
375
Dec-14
41334
375
Aug-15
Mar-13
574
Jan-17
Jan-14
Keppel FELS, Singapore Keppel FELS, Singapore Shanghai Waigaoqiao, China
400 400 375
Mar-15 Jun-16 Aug-15
Apr-13 Nov-13 Aug-13
Rig manager Alliance Offshore Drilling PTE Ltd Alliance Offshore Drilling PTE Ltd Bestford Offshore PTE Ltd. Bestford Offshore PTE Ltd. Bestford Offshore PTE Ltd.
Rig name Alliance Driller 1
2015
Bestford Offshore PTE Ltd.
Bestford Jackup TBN 4
2015
Central Shipping Monaco
2015
Central Shipping Monaco
2015
China Oilfield Services Ltd. China Oilfield Services Ltd. Clearwater Capital Partners LLC Clearwater Capital Partners LLC CNPC (NOC) CNPC (NOC)
2015 2015 2015 2015
2015 2015 2016 2014 2015
Alliance Driller 2 Bestford Jackup TBN 1 Bestford Jackup TBN 2 Bestford Jackup TBN 3
Construction shipyard CSSC Guangzhou Huangpu, China CSSC Guangzhou Huangpu, China China Merchants Heavy Industries, Shenzen, China China Merchants Heavy Industries, Shenzen, China CMHI Shipyard, China
Rig builder CSSC Offshore CSSC Offshore
China Merchant Heavy Industries China Merchant Heavy Industries FG Offshore
Dalian Shipyard CIMC Raffles
2014
Coastal Contracts Bhd
2016
Coastal Contracts Bhd
2014
CPTDC
2014
DDW-PaxOcean
2015
DDW-PaxOcean
2017
Drill One Capital
2015 2016 2015
ENSCO ENSCO ESSM
2015
ESSM
ESSM Jackup TBN 2
Shanghai Waigaoqiao, China
375
Dec-15
Aug-13
2016
Fecon International Corp. Fecon International Corp.
Fecon Jackup TBN 1 Fecon Jackup TBN 2
Keppel FELS, Singapore
400
Jul-16
Feb-14
Keppel Fels Keppel Fels Shanghai Waigaoqiao Shipbuildin g Shanghai Waigaoqiao Shipbuildin g Keppel Fels
Keppel FELS, Singapore
400
Sep-16
Feb-14
Keppel Fels
2016
18
DDW-PaxOcean Jackup TBN 1 DDW-PaxOcean Jackup TBN 2 Dubai Expo 2020 NS ENSCO 110 ENSCO 123 ESSM Jackup TBN 1
CIMC Raffles
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
2016
Fecon Jackup TBN 3 FTS Derricks Jackup TBN 2
Keppel FELS, Singapore
400
Nov-16
Feb-14
Keppel Fels
2015
Fecon International Corp. FTS Derricks
Shanhaiguan Shipbuilding, China
400
Jul-15
Jul-13
2015
FTS Derricks
FTS Derricks Jackup TBN 3
Shanhaiguan Shipbuilding, China
400
Sep-15
Jul-13
2016
FTS Derricks
FTS Derricks Jackup TBN 4
Shanhaiguan, China
400
May-16
Sep-13
2016
FTS Derricks
FTS Derricks Jackup TBN 5
Shanhaiguan, China
400
May-16
Sep-13
2015 2015
FTS Derricks Grupo R
Keppel FELS, Singapore Keppel FELS, Singapore
425 400
Aug-15 Jan-15
Apr-13 Feb-13
2015
Grupo R
Keppel FELS, Singapore
400
Feb-15
Feb-13
Keppel Fels
2015
Grupo R
Keppel FELS, Singapore
400
Apr-15
Feb-13
Keppel Fels
2015
Grupo R
Keppel FELS, Singapore
400
Jun-15
Feb-13
Keppel Fels
2015
Grupo R
Keppel FELS, Singapore
400
Dec-15
Jul-13
Keppel Fels
2014
Keppel FELS, Singapore
300
Oct-14
May-11
Keppel Fels
2014
Gulf Drilling International Hercules Offshore
TS Topaz Grupo R Jackup TBN 1 Grupo R Jackup TBN 2 Grupo R Jackup TBN 3 Grupo R Jackup TBN 4 Grupo R Jackup TBN 5 Dukhan
China Shipbuildin g Industry Corp. China Shipbuildin g Industry Corp. Shanhaigua n Shipbuildin g Industry Co., Ltd Shanhaigua n Shipbuildin g Industry Co., Ltd Keppel Fels Keppel Fels
PPL Shipyard, Singapore
400
Jul-14
May-12
2015
Hercules Offshore
PPL Shipyard, Singapore
400
Jun-15
Feb-13
2015
Japan Drilling
Perisai Pacific 101 Perisai Pacific 102 Hakuryu-12
PPL Shipyard, Singapore
400
Jan-15
May-13
2014
Jindal Pioneer
Lamprell Shipyard, UAE
350
Dec-14
Feb-13
KS Energy Jackup TBN 4 Orient Star 1
Citra Tubindo Shipyard, Batam, Indonesia Nantong Shipyard, China
400
Sep-15
Jun-13
400
Apr-14
May-11
Orient Star 2
Nantong Shipyard, China
400
Jul-14
May-11
2015
Jindal Drilling & Industries Ltd. KS Energy Services Ltd. KS Energy Services Ltd. KS Energy Services Ltd. Landmark Drilling
PPL Shipyard PPL Shipyard PPL Shipyard LeTourneau
Jan-15
Mar-13
Landmark Drilling
400
Mar-15
Mar-13
2016
Lovanda Offshore Ltd
CMIH, Jiangsu Haixin SHI, Nantoing, China CMIH, Jiangsu Haixin SHI, Nantoing, China Shanghai Zhenhua, China
400
2015
Landmark Drilling Jackup TBN 1 Landmark Drilling Jackup TBN 2 Lovanda Jackup TBN 1
400
Oct-16
Feb-14
2017
Lovanda Offshore Ltd
Lovanda Jackup TBN 2
Shanghai Zhenhua, China
400
Mar-17
Feb-14
2015
Marco Polo Drilling
PPL Shipyard, Singapore
400
Dec-15
Feb-14
2014
Noble Drilling
Jurong Shipyard, Singapore
400
Nov-14
Aug-11
2014
Noble Drilling
Jurong Shipyard, Singapore
400
Oct-14
Aug-11
Jurong
2016
Northern Offshore Ltd
Marco Polo Jackup TBN 1 Noble Sam Hartley Noble Tom Prosser Northern Offshore Jackup TBN 1
Shanghai Zhenhua Port Machinery Shanghai Zhenhua Port Machinery PPL Shipyard Jurong
COSCO Dalian, China
350
Mar-16
Oct-13
COSCO Corp.
2015 2014 2014
COSCO Corp. COSCO Corp.
19
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
2016
Northern Offshore Ltd
COSCO Dalian, China
350
Sep-16
10/4/2013
JNYS, China
350
Aug-15
Dec-12
2015 2014
Offshore Logistics (Asia Pacific) Ltd Oro Negro Oro Negro
Northern Offshore Jackup TBN 2 Explorer Jackup TBN 01 Animus Impetus
2015
PPL Shipyard, Singapore PPL Shipyard, Singapore
400 400
Sep-15 Dec-14
Jun-13 Mar-13
2015
Oro Negro
Supremus
PPL Shipyard, Singapore
400
Jul-15
Jun-13
2015
Oro Negro
Vastus
PPL Shipyard, Singapore
400
Mar-15
Mar-13
2015
Parden Holding
Keppel FELS, Singapore
400
Nov-15
8/1/2013
2014
Perforadora Central
Parden Holding Jackup TBN 1 Coatzacoalcos
PPL Shipyard PPL Shipyard PPL Shipyard Keppel Fels
375
May-14
Apr-12
Keppel Fels
2014
Perforadora Mexico
Campeche 01
400
Mar-14
Apr-11
2016
Perisai Petroleum Teknologi Bhd Polynor Drilling
Perisai Pacific 103 Polynor 1
Keppel AmFELS, Brownsville, TX Dalian Shipbuilding Industry Offshore, China PPL Shipyard, Singapore
400
Sep-16
Dec-13
CMHI Shipyard, China
375
Jun-15
May-13
Prospector Offshore Drilling S.A. Prospector Offshore Drilling S.A.
Prospector 6
Shanghai Waigaoqiao, China
400
Jul-14
8/2/2011
Prospector 7
Shanghai Waigaoqiao Shipyard, China
400
Sep-15
Mar-13
2016
Prospector Offshore Drilling S.A.
Prospector 8
Shanghai Waigaoqiao Shipyard, China
400
Mar-16
Mar-13
FG Offshore PPL Shipyard China Merchant Heavy Industries FG Offshore Shanghai Waigaoqiao Shipbuildin g Shanghai Waigaoqiao Shipbuildin g
2015
PT Apexindo
Dalian Shipyard, China
400
Jun-15
Apr-13
2014 2015
PT Apexindo PV Drilling
PT Apexindo Jackup TBN 2 Tasha PV Drilling VI
400 400
Jun-14 Dec-15
Oct-12 Jul-13
2016
Seadrill Ltd
West Dione
Dalian Shipyard, China Keppel FELS Shipyard, Singapore Dalian Shipyard, China
400
Jun-16
Jul-13
2015
Seadrill Ltd
West Hyperion
Dalian Shipyard, China
400
Dec-15
Jun-13
2016 2015
Seadrill Ltd Seadrill Ltd
West Mimas West Proteus
Dalian Shipyard, China Dalian Shipyard, China
400 400
Sep-16 Jun-15
Jul-13 Jan-13
2015 2015 2015
Seadrill Ltd Seadrill Ltd Seadrill Ltd
West Rhea West Tethys West Titan
Dalian Shipyard, China Dalian Shipyard, China Dalian Shipyard, China
400 400 400
Sep-15 Dec-15 Mar-15
Mar-13 Mar-13 Jan-13
2014
Seadrill Ltd
West Titania
400
Mar-14
Apr-11
2016
Seadrill Ltd
West Umbriel
Dalian Shipbuilding Industry Offshore, China Dalian Shipyard, China
400
Mar-16
Jun-13
2014
ShengLi Offshore
Shengli I
CIMC Raffles, China
164
Jun-14
Apr-13
2014
Star Drilling Pte Ltd
Keppel FELS, Singapore
350
Dec-14
Feb-13
2015
Cosco Shipyard, Dalian, China
350
Feb-15
Aug-12
Sep-15
Aug-13
400
Jun-15
Mar-13
2015
Tianjin Haiheng
Haiheng CJ50-2
400
Sep-15
Mar-13
2016
Transocean Ltd.
Transocean Jackup TBN 1
Cosco - Dalian Shipyard, China China Merchants Heavy Industry, Shenzhen, China China Merchants Heavy Industry, Shenzhen, China Keppel FELS, Singapore
350
2015
Talland Navigation Ltd Talland Navigation Ltd Tianjin Haiheng
Star Drilling Jackup TBN 1 Talland Jackup TBN 1 Talland Jackup TBN 2 Haiheng CJ50-1
400
Mar-16
Nov-13
2015
2014 2015
2015
20
COSCO Corp.
Keppel Fels Dalian Shipyard Dalian Shipyard Dalian Shipyard Dalian Shipyard FG Offshore Dalian Shipyard CIMC Raffles Keppel Fels
COSCO Corp.
Keppel Fels
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
2016
Transocean Ltd.
Transocean Jackup TBN 2 Transocean Jackup TBN 3 Transocean Jackup TBN 4 Transocean Jackup TBN 5 TS Offshore Jackup TBN 1 UMW Naga 6
Keppel FELS, Singapore
400
Jul-16
Nov-13
Keppel Fels
2016
Transocean Ltd.
Keppel FELS, Singapore
400
Nov-16
Nov-13
Keppel Fels
2017
Transocean Ltd.
Keppel FELS, Singapore
400
Mar-17
Nov-13
Keppel Fels
2017
Transocean Ltd.
Keppel FELS, Singapore
400
Jul-17
Nov-13
Keppel Fels
2017
TS Offshore Limited
Keppel FELS, Singapore
500
Mar-17
Mar-14
Keppel Fels
2014
2014
UMW Standard Drilling Sdn Bhd UMW Standard Drilling Sdn Bhd UMW Standard Drilling Sdn Bhd Varada-HvR
CMHI, Shenzhen, China
375
Sep-14
Sep-12
UMW Naga 7
CMHI, Shenzhen, China
375
Dec-14
Sep-12
UMW NAGA 8
Keppel FELS, Singapore
400
Sep-15
Feb-14
Keppel Fels
Varada 1
ABG Shipyard
350
Dec-14
Feb-07
Varada-HvR
Varada 2
ABG Shipyard, India
350
Dec-14
Feb-07
2014
Varada-HvR
Varada 3
ABG Shipyard, India
350
Jun-14
Nov-10
2014
Varada-HvR
Varada 4
ABG Shipyard, India
350
Dec-14
Nov-10
FG Offshore FG Offshore FG Offshore FG Offshore
2014
2014 2015
Varada-HvR Viking Offshore & Marine Ltd
Varada 5 Viking O&M Jackup TBN 1
CIMC Raffles, China China Merchant Heavy Industries, Shenzhen/Jiangsu
400 375
Dec-14 Nov-15
Sep-12 Nov-13
2015
Viking Offshore & Marine Ltd
Viking O&M Jackup TBN 2
China Merchant Heavy Industries, Shenzhen/Jiangsu
375
Dec-15
Mar-14
2014 2015
China Merchant Heavy Industries China Merchant Heavy Industries
Source: Riglogix.
21
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Un-contracted under-construction semisubs Table 32: Un-contracted semisub deliveries Delivery year 2016
Rig manager Beacon Holdings Group Ltd.
Rig name Beacon Atlantic
Construction shipyard CIMC Raffles, China
Max WD (in ft) 1640
Delivery date Dec-16
Order date Jan-14
2016
Caspian Drilling
Dec-16
Jun-13
China Oilfield Services Ltd.
Keppel CSC, Azerbaijan CIMC Raffles, China
3000
2014
Caspian Drilling Semisub TBN 1 COSLProspector
5000
Sep-14
Sep-11
2016
China Oilfield Services Ltd.
Aug-16
Oct-13
Frigstad Offshore
12000
Dec-15
Jan-13
2016
Frigstad Offshore
12000
Jun-16
Jan-13
2016
Landmark Drilling
4000
Sep-16
Nov-13
2015
North Atlantic Drilling Ltd.
10000
Mar-15
Apr-12
2015
North Sea Rigs AS
North Dragon
Dalian Shipyard, China CIMC Raffles Shipyard, China CIMC Raffles Shipyard, China CIMC Raffles, Shandong, China Jurong Shipyard, Singapore CIMC Raffles, China
5000
2015
Hai Yang Shi You 982 Frigstad Semisub TBN 1 Frigstad Semisub TBN 2 Landmark Drilling Semisub TBN 1 West Rigel
4000
Feb-15
Feb-12
2017
Primepoint Drilling PTE Ltd.
Feb-17
Feb-14
2017
Primepoint Drilling PTE Ltd.
Feb-17
Feb-14
2014
Seadrill Ltd
Primepoint Semisub TBN 1 Primepoint Semisub TBN 2 Sevan Developer
10000
Sep-14
Mar-11
2016
Stena Drilling
Stena Drilling Semisub TBN 1
7500
Mar-16
Jun-13
Samsung
2016
Stena Drilling
Stena Drilling Semisub TBN 2
7500
Sep-16
Jun-13
Samsung
Source: Riglogix.
22
Jiangsu Yangzijiang Shipyard, China Jiangsu Yangzijiang Shipyard, China COSCO Shipyard, Nantong, China Samsung Heavy Industries, South Korea Samsung Heavy Industries, South Korea
Rig builder CIMC Raffles Keppel Fels CIMC Raffles Dalian Shipyard CIMC Raffles CIMC Raffles CIMC Raffles Jurong CIMC Raffles
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Un-contracted under-construction drillships Table 33: Un-contracted drillship deliveries Delivery year 2015
Rig manager Atwood Oceanics
Rig name Atwood Admiral
Construction shipyard Daewoo Shipyard, South Korea
Max WD (in ft) 12000
Delivery date Mar-15
Order date Sep-12
Atwood Archer Dalian Developer
Daewoo Shipyard, South Korea Cosco Shipyard, China
12000 10000
Dec-15 May-14
Jun-13 Jun-06
2015
Atwood Oceanics Dalian Deepwater Developer LTD Diamond Offshore
Ocean BlackLion
12000
Apr-15
May-12
2014
Diamond Offshore
12000
Dec-14
May-11
2015 2014
ENSCO ENSCO
Ocean BlackRhino ENSCO DS-10 ENSCO DS-8
12000 12000
Sep-15 Sep-14
Jun-13 Apr-12
2014
12000
Dec-15
Oct-13
Daewoo Shipyard, South Korea
12000
Dec-15
Oct-13
2015
ESSA Servicos de Perfuracao ESSA Servicos de Perfuracao Keppel Fels
Hyundai Heavy Industries, South Korea Hyundai Heavy Industries, South Korea Samsung Shipyard, South Korea Samsung Geoje Shipyard, South Korea Daewoo Shipyard, South Korea
Keppel FELS, Singapore
12000
Dec-16
Dec-13
2016
Maersk Drilling
12000
Sep-14
Jul-11
Samsung
2014
Maersk Drilling
12000
Aug-14
Jul-11
Samsung
2014
Ocean Rig Asa
12000
Dec-15
Sep-13
Samsung
2014 2014 2014
5000 5000 12000
Mar-14 Mar-14 Jun-14
Sep-11 40807 Mar-12
CSSC Offshore CSSC Offshore Samsung
12000
Mar-15
Jan-13
Samsung
Brava Star
12000
Dec-14
41227
Samsung
2015
Opus Offshore Opus Offshore Pacific Drilling Limited Pacific Drilling Limited Queiroz Galvao Oleo e Gas S.A. Rowan
Samsung Heavy Industries, South Korea Samsung Heavy Industries, South Korea Samsung Heavy Industries, South Korea Shanghai Shipyard, China Shanghai Shipyard, China Samsung Heavy Industries, South Korea Samsung Heavy Industries, South Korea Samsung Heavy Industries
Mar-15
Sep-12
Seadrill Ltd
Hyundai Heavy Industries, South Korea DSME Shipyard, South Korea
12000
2015
Rowan Relentless West Aquila
12000
Oct-15
Jul-13
2014 2015
Seadrill Ltd Seadrill Ltd
West Carina West Dorado
12000 12000
Dec-14 Dec-15
Sep-12 Jul-13
2015
Seadrill Ltd
West Draco
12000
Sep-15
Jul-13
Samsung
2014
Seadrill Ltd
West Jupiter
12000
Sep-14
Feb-12
Samsung
2015
Seadrill Ltd
West Libra
Samsung Shipyard, South Korea Samsung Heavy Industries, South Korea Samsung Heavy Industries, South Korea Samsung Heavy Industries, South Korea DSME Shipyard, South Korea
12000
Dec-15
Jul-13
2014
Seadrill Ltd
West Saturn
12000
May-14
Apr-12
2016
Sete Brasil S.A.
10000
Sep-16
Nov-12
Jurong
2015
Transocean Ltd.
Jurong Shipyard, Singapore
12000
Jun-17
Feb-14
Jurong
2016
Transocean Ltd.
Jurong Shipyard, Singapore
12000
Mar-18
Feb-14
Jurong
2016
Vantage Drilling
Sete Jurong Drillship TBN 7 Transocean Espadon Drillship TBN 1 Transocean Espadon Drillship TBN 2 Cobalt Explorer
Samsung Heavy Industries, South Korea Estaleiro Jurong Aracruz, Brazil
Daewoo Shipbuilding Samsung
Daewoo Shipyard, South Korea
12000
Mar-15
Nov-08
Daewoo Shipbuilding
2015 2014
2015
2015 2014
DSME e-Smart Drillship TBN 1 DSME e-Smart Drillship TBN 2 Keppel Drillship TBN 1 Maersk Drillship TBN 4 Maersk Venturer Ocean Rig Santorini Tiger 1 Tiger 2 Pacific Meltem Pacific Zonda
Rig builder Daewoo Shipbuilding
Hyundai Heavy Industries Hyundai Heavy Industries Samsung Samsung Daewoo Shipbuilding Daewoo Shipbuilding Keppel Fels
Hyundai Heavy Industries Daewoo Shipbuilding Samsung Samsung
Source: Riglogix.
23
0
24
Seadrill Ltd Grupo R Oro Negro Transocean Ltd. Varada-HvR KS Energy Services Ltd. National Drilling Noble Drilling Prospector Offshore Drilling S.A. Tianjin Haiheng ENSCO FTS Derricks Maersk Drilling Alliance Offshore Drilling PTE Ltd Bestford Offshore PTE Ltd. China Oilfield Services Ltd. Clearwater Capital Partners LLC DDW-PaxOcean ESSM Hercules Offshore KCA Deutag Landmark Drilling Northern Offshore Ltd Pemex (NOC) Perforadora Central PT Apexindo Talland Navigation Ltd CNPC (NOC) CPTDC Eurasia Drilling Company Greatship Global Gulf Drilling International Japan Drilling Jindal Drilling & Industries Ltd. Offshore Logistics (Asia Pacific) Ltd Parden Holding Perforadora Mexico PV Drilling ShengLi Offshore Star Drilling Pte Ltd Teniz Burgylau LLP UMW Standard Drilling Sdn Bhd Viking Offshore & Marine Ltd
Ajay Mirchandani (65) 6882-2419 [email protected]
50 40 30 20 10 0 45 44
4
2
Source: Riglogix, J.P. Morgan.
40
Asia Pacific Equity Research 16 April 2014
Jackups: Leading players and under-construction by player
Figure 29: Leading players of existing jackups
No. of rigs
37 30
Source: Riglogix, J.P. Morgan.
29 20 15 14 13 13 12 8 8 7
Series1
Figure 30: Under-construction jackups by owner
10 9
8
6 5 5 5 5
4 4 4 4 4 3 3 3 2 2 2 2 2 2 2 2 2 2 2 2 2 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1
$800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $0
$800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $0
1-3-2006 1-9-2006 21-6-2007 25-9-2007 29-1-2008 20-4-2008 31-5-2008 23-6-2008 30-6-2008 30-6-2008 30-6-2008 10-9-2008 24-12-2008 28-6-2010 6-8-2010 17-1-2011 9-5-2011 11-5-2011 30-1-2012 6-4-2012 4-6-2012 19-7-2012 25-7-2012 27-8-2012 15-11-2012 9-5-2013 19-7-2013 6-1-2014
2-1-2012 2-2-2012 20-3-2012 1-5-2012 26-6-2012 16-8-2012 21-9-2012 31-10-2012 26-11-2012 11-1-2013 11-2-2013 11-3-2013 13-3-2013 11-4-2013 5-6-2013 11-7-2013 12-7-2013 20-8-2013 23-9-2013 16-10-2013 25-11-2013 1-12-2013 1-12-2013 17-12-2013 20-2-2014 19-3-2014 31-3-2014 15-4-2014 1-5-2014 30-6-2014
$0
1/19/2012 2/19/2012 3/19/2012 4/19/2012 5/19/2012 6/19/2012 7/19/2012 8/19/2012 9/19/2012 10/19/2012 11/19/2012 12/19/2012 1/19/2013 2/19/2013 3/19/2013 4/19/2013 5/19/2013 6/19/2013 7/19/2013 8/19/2013 9/19/2013 10/19/2013 11/19/2013 12/19/2013 1/19/2014 2/19/2014
Ajay Mirchandani (65) 6882-2419 [email protected] Asia Pacific Equity Research 16 April 2014
Dayrates of recent fixtures
Figure 31: Jackup recent fixture rates (depth<=400ft, age<=5yrs)
US$
$250,000
$200,000
$150,000
$100,000 $50,000
Source: Riglogix.
Figure 32: Drillships recent fixture rates (age<=5yrs)
US$
Source: Riglogix.
Figure 33: Semisubs recent fixture rates (age<=5yrs)
US$
Source: Riglogix.
25
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Jackups: Rigs deployed in SE Asia, Middle East and Mexico Figure 34: Jackups in SE Asia No. of rigs
80 70 60 50 40 30 20 10 0
37 2 9 6 8 11
1
2008
32 2 8 5 5 11
1
2009 Malaysia
38 3 14 5 9 6
1
2010
Indonesia
47 3 13 7 10
Thailand
0
14 2011 Viet nam
53 3 11 11
0
65 4 16
0
12
62 13 17 12
14
17
14
14
16
15
2012
2013
Brunei Darussalam
2014 YTD Other
Source: Riglogix, J.P. Morgan.
Figure 35: Jackups in Middle East No. of rigs
120 100 80
13
12
8
75
67
71
2008
2009
2010
8
9
91
96
93
2012
2013
2014 YTD
9
7
82
2011
60 40 20 0 MidEast - Persian Gulf
MidEast - Red Sea
Source: Riglogix, J.P. Morgan.
Figure 36: Jackups in Mexico No. of rigs
50 45 40 35 30 25 20 15 10 5 0
45
25
23
2008
2009
26
36
2012
2013
26 20
2010
2011 Mexico
Source: Riglogix, J.P. Morgan.
34
2014 YTD
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
Figure 37: Jackups in Malaysia No. of rigs
18 16 14 12 10 8 6 4 2 0
16 11
14
14
2011
2012
15
11 6
2008
2009
2010
2013
2014 YTD
Malaysia Source: Riglogix, J.P. Morgan.
Table 34: Jackups drilling in Malaysia currently Rig name Deep Driller 3 ENSCO 105 ENSCO 106 ENSCO 52 Maersk Convincer Noble George McLeod JP Bussell Rowan EXL IV West Courageous West Leda West Vigilant Trident IX Naga 3 UMW Naga 4 Aquamarine Driller
Rig owner Sinvest ENSCO Ensco / Keppel Fels Ltd ENSCO Maersk Drilling Noble Drilling Rowan Rowan Seadrill Ltd Seadrill Ltd Seadrill Ltd Shelf Drilling UMW Petropipe/Singapore Drilling UMW Standard Drilling Sdn Bhd Vantage Drilling
Operator
Rig type
Rig
Water depth
Age
Current contract
Dayrate
Petronas Carigali (NOC) Shell Newfield Murphy Petronas Carigali (NOC) Talisman Petrofac Carigali-Hess Operating Co. Petronas Carigali (NOC) ExxonMobil Talisman Petrofac Petronas Carigali (NOC)
Jackup
status Drilling
(ft) 350
(years) 7.2
end 1-Nov-15
(US$/day) 139,500
Jackup Jackup Jackup Jackup
Drilling Drilling Drilling Drilling
400 400 300 375
11.4 9.2 31.2 5.5
20-Nov-14 29-Oct-14 1-Aug-14 2-Nov-14
165,000 159,000 85,000 148,000
Jackup Jackup Jackup
Drilling Drilling Drilling
300 300 350
32.6 5.3 2.5
20-Apr-14 1-Oct-14 1-Dec-14
115,000 143,000 151,000
Jackup
Drilling
350
6.8
23-Apr-14
150,000
Jackup Jackup Jackup Jackup
Drilling Drilling Drilling Drilling
375 350 400 350
3.6 5.5 31.9 3.5
1-Mar-15 1-Nov-14 25-Jul-15 21-Mar-14
165,000 167,000 135,000 138,000
Petronas (NOC)
Jackup
Drilling
400
1.1
1-Apr-16
146,000
Petronas Carigali (NOC)
Jackup
Drilling
375
4.5
16-Nov-14
155,000
Source: Riglogix.
27
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Deepwater rigs: Rigs deployed in key markets Figure 38: Deepwater floaters in Brazil No. of rigs
80 70 60 50 40 30 20 10 0
68
68
12
25
24
46
49
43
44
2010
2011
2012
2013
2014 YTD
34
34
19
21
61
54 44 33
8
2008
25
11
8 25
62
33 2009
Semisub
37
Drillship
Source: Riglogix, J.P. Morgan.
Figure 39: Deepwater floaters in West Africa No. of rigs
35 30 25 20
28 9
26 22 11
19
5
27
12
12
16
15
15
13
2011
2012
2013
2014 YTD
8
15 10
28
15
14
2009
2010
0 2008
Semisub
Drillship
Source: Riglogix, J.P. Morgan.
Figure 40: Deepwater floaters in U.S. GOM No. of rigs
40 35 30 25 20 15 10 5 0
39 31 22 4
25
21 19
6
11
7 18
19 1
2008
2009
12
2
Source: Riglogix, J.P. Morgan.
16
18
16
2012
2013
2014 YTD
1 2010
2011 Semisub
28
15
27
Drillship
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Figure 41: Deepwater floaters in North Sea No. of rigs
45 40 35 30 25 20 15 10 5 0
41
37
36 2
32
28
2
1 34
2008
27
30
2009
2010
2
42 1
2
28 2 35
39
41
2013
2014 YTD
26
2011 Semisub
2012
Drillship
Source: Riglogix, J.P. Morgan.
29
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Investment Thesis, Valuation and Risks Keppel Corporation (Overweight; Price Target: S$13.50) Investment Thesis We remain Overweight on Keppel, as we continue to see strong order momentum in jackups (74 jackups ordered in 2013 globally). Keppel remains our top pick among Singapore rig builders due to: (1) better O&M margins forecasted over the next one to two years, as Brazil will act as baseload; (2) product mix, as Keppel enjoys orders in the FLNG market; (3) potential drillship/FLNG orders; and (4) orders expected from Mexico as it sets up a yard. Valuation Our Dec-14 PT of S$13.50 is based on our sum-of-the-parts valuation with a DCFbased calculation for the rig-building business and a 12x P/E for the ship repair and other businesses, in line with the historical average for the repair business. We value property (Keppel Bay) at NAV and Keppel Land at our PT. Finally, we value the infrastructure business at 1.5x book. Listed entities:
Stake
Price/Factor
Valuation
Keppel Telecommunications & Transportation k1 Venture K-Green Trust KrisEnergy Market valuation of listed entities (ex-property) DCF valuation of Offshore & Marine DCF valuation of existing order book only Business value of offshore-conversion Ship repair & others DCF valuation of Infrastructure business (ex-Kep T&T) DCF valuation of Keppel Bay property project Keppel Land K-REIT
80% 36% 49.9% 31.4%
1.54 0.193 1.045 0.87
55% 29%
1.5 0% 0% 1.18
685 151 328 284 1448 14,538 1,670 10,912 1,956 1,199 1,289 3126 963
Net cash/ (debt) -- (excluding cash advances) at O&M Fair value of Keppel Corp Price target
Per share (S$) 0.38 0.08 0.18 0.16 0.80 8.04 0.92 6.04 1.08 0.66 0.71 1.73 0.53
1,710 24273
Risks to Rating and Price Target The key risks to our rating and PT include a worse-than expected delay in new orders, a collapse in oil prices and worse-than-expected operating margins.
30
0.95 13.43 13.50
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Keppel Corporation: Summary of Financials Income Statement Cash flow statement S$ in millions, year end Dec FY11 FY12 FY13 FY14E FY15E S$ in millions, year end Dec Revenues 10,082 13,965 12,380 12,464 14,726 EBIT EBITDA 3,033 2,832 2,377 2,049 2,396 Depreciation & amortization % change Y/Y 73.8% (6.6%) (16.1%) (13.8%) 16.9% Change in working capital EBITDA Margin 30.1% 20.3% 19.2% 16.4% 16.3% Other non-cash items EBIT 2,824 2,621 2,134 1,748 2,088 Cash flow from operations % change Y/Y 81.5% (7.2%) (18.6%) (18.1%) 19.4% EBIT Margin 28.0% 18.8% 17.2% 14.0% 14.2% Capex Net Interest 16 26 19 121 262 Disposal/(purchase) Associates 448 603 626 256 39 Cash flow from investments Exceptionals (455) (323) (434) 0 (4) Equity raised/(repaid) Earnings before tax 3,313 3,256 2,794 2,143 2,411 Debt raised/(repaid) % change Y/Y 29.9% (1.7%) (14.2%) (23.3%) 12.5% Other Tax (444) (501) (397) (174) (233) Dividends paid as % of EBT 13.4% 15.4% 14.2% 8.1% 9.7% Cash flow from financing Minority Interests (923) (518) (551) (466) (456) Net change in cash Net income (reported) 1,946 2,237 1,846 1,504 1,721 Beginning cash Net income (recurring) 1,491 1,914 1,412 1,504 1,717 Ending cash Shares outstanding 1,784 1,798 1,808 1,808 1,808 EPS (Recurring) 0.84 1.06 0.78 0.83 0.95 Free cash flow EPS (reported) 1.09 1.24 1.02 0.83 0.95 DPS Balance sheet Ratio Analysis S$ in millions, year end Dec FY11 FY12 FY13 FY14E FY15E S$ in millions, year end Dec Cash and cash equivalents 3,020 4,055 5,565 7,916 8,891 Gross margin Accounts receivable 2,028 1,995 1,916 2,226 2,630 EBITDA margin Inventories 6,606 7,443 8,995 8,310 9,818 EBIT margin Others 981 1,114 1,482 1,482 1,482 Net margin Current assets 12,635 14,607 17,957 19,933 22,821 LT investments 4,921 5,648 2,453 2,453 2,453 Sales growth Net fixed assets 2,716 3,337 3,798 3,828 4,072 EBIT growth Total Assets 25,099 29,171 30,056 32,061 35,193 Net profit growth Short-term loans 808 1,006 517 517 517 EPS growth Payables 5,710 5,536 5,409 6,232 7,363 Total current liabilities 9,003 9,064 9,342 10,273 12,122 Interest coverage (x) Long-term debt 4,069 6,202 6,583 6,583 6,583 Net debt to equity Other liabilities 267 326 442 442 442 Total Liabilities 13,338 15,592 16,367 17,297 19,147 Sales/assets Shareholders' equity 7,699 9,246 9,701 10,310 11,136 Assets/equity Total Liabilities and equity 25,099 29,171 30,056 32,061 35,193 ROE BVPS 4.32 5.14 5.37 5.70 6.16 ROCE Source: Company reports and J.P. Morgan estimates.
FY11 FY12 2,824 2,621 209 211 (1,890) (1,448) (1,045) (192) (224) 1,007
FY13 2,134 242 (734) (458) 625
FY14E 1,748 300 1,306 274 3,576
FY15E 2,088 308 (62) 61 2,423
(802) (860) (1,258) (1,069) 99 82 809 2,331 90 (346) (724) (789) 275 1,277 (1,225) 1,035 4,246 3,020 3,020 4,055
(903) (678) 40 2,130 253 (895) 1,528 1,509 4,055 5,564
(467) (467) 0 0 0 (895) (895) 2,213 5,565 7,778
(552) (552) 0 0 0 (895) (895) 976 7,916 8,891
(1,039) 0.43
124 0.45
(295) 0.50
2,997 0.50
1,634 0.50
FY11 30.1% 28.0% 14.8%
FY12 20.3% 18.8% 13.7%
FY13 19.2% 17.2% 11.4%
FY14E 16.4% 14.0% 12.1%
FY15E 16.3% 14.2% 11.7%
10.3% 81.5% 28.8% 12.9%
38.5% (7.2%) 15.0% 27.4%
(11.3%) 0.7% (18.6%) (18.1%) (17.5%) (18.5%) (26.7%) 6.5%
18.1% 19.4% 14.4% 14.2%
NM 15.8%
NM 23.2%
NM 11.2%
NM NM (5.5%) (11.2%)
44.3% 51.5% 41.8% 40.1% 43.8% 322.8% 320.3% 312.6% 310.4% 313.6% 21.1% 22.6% 14.9% 15.0% 16.0% 21.2% 15.3% 11.0% 9.4% 10.6%
31
Asia Pacific Equity Research 16 April 2014
Ajay Mirchandani (65) 6882-2419 [email protected]
JPM Q-Profile Keppel Corporation Limited (SINGAPORE / Industrials) As Of: 11-Apr-2014
[email protected]
Local Share Price
Current:
11.00
12 Mth Forward EPS
16.00
1.20
14.00
1.00
12.00
Current:
0.91
0.80
10.00 0.60
8.00 6.00
0.40
4.00
0.20
2.00
0.00
Earnings Yield (& local bond Yield) 20%
12Mth fwd EY
Current:
Singapore BY
8%
Implied Value Of Growth*
Current:
Oct/13
Mar/13
Jan/12
Aug/12
Jun/11
Apr/10
Nov/10
Sep/09
Jul/08
Feb/09
Dec/07
Oct/06
May/07
Mar/06
Jan/05
Aug/05
Jun/04
Apr/03
Nov/03
Sep/02
Jul/01
Feb/02
Dec/00
Oct/99
May/00
-0.20 Mar/99
Oct/13
Mar/13
Jan/12
Aug/12
Jun/11
Apr/10
Nov/10
Sep/09
Jul/08
Feb/09
Dec/07
Oct/06
May/07
Mar/06
Jan/05
Aug/05
Jun/04
Apr/03
Nov/03
Sep/02
Jul/01
Feb/02
Dec/00
Oct/99
May/00
Mar/99
0.00
-23.47%
1.00
Proxy
18% 16%
0.50
14% 12%
0.00
10% 8%
-0.50
6% 4%
-1.00
2%
Current:
19.48
10.0
30.00
9.0
Oct/13
Mar/13
Aug/12
Jan/12
Current:
Oct/13
Mar/13
Aug/12
Jan/12
Jun/11
Nov/10
Apr/10
Sep/09
Feb/09
Jul/08
Dec/07
May/07
Oct/06
Mar/06
Jan/05
Aug/05
Jun/04
Apr/03
Nov/03
Sep/02
Jul/01
Feb/02
Dec/00
2.1x
PBV Forward
Dividend Yield (Trailing)
35.00
Jun/11
Nov/10
Apr/10
Sep/09
Jul/08
Feb/09
Dec/07
Oct/06
May/07
Mar/06
Jan/05
Aug/05
Jun/04
Apr/03
Nov/03
Sep/02
Jul/01
Dec/00
Oct/99
Feb/02
Current: PBV hist
Mar/99
Oct/13
Mar/13
Aug/12
Jan/12
Jun/11
Nov/10
Apr/10
Sep/09
Feb/09
Jul/08
Dec/07
May/07
Oct/06
Mar/06
Aug/05
Jan/05
Jun/04
0.0x
Nov/03
0.0x Apr/03
1.0x
Sep/02
2.0x
5.0x
Feb/02
3.0x
10.0x
Jul/01
15.0x
Dec/00
4.0x
May/00
5.0x
20.0x
Oct/99
25.0x
Mar/99
6.0x
ROE (Trailing)
May/00
Price/Book Value
30.0x
May/00
12.1x
Mar/99
Oct/13
Mar/13
Aug/12
Jan/12
Current:
-1.50
Oct/99
PE (1Yr Forward)
Jun/11
Nov/10
Apr/10
Sep/09
Feb/09
Jul/08
Dec/07
May/07
Oct/06
Mar/06
Aug/05
Jan/05
Jun/04
Nov/03
Apr/03
Sep/02
Feb/02
Jul/01
Dec/00
May/00
Oct/99
Mar/99
0%
3.67
8.0
25.00
7.0
20.00
6.0
15.00
5.0 4.0
10.00
3.0
5.00
Oct/13
Mar/13
Aug/12
Jan/12
Jun/11
Nov/10
Apr/10
Sep/09
Feb/09
Jul/08
Dec/07
May/07
Oct/06
Mar/06
Aug/05
Jan/05
Jun/04
Nov/03
Apr/03
Sep/02
Feb/02
Jul/01
Dec/00
May/00
Mar/99
Oct/13
Mar/13
Aug/12
Jan/12
Jun/11
Nov/10
Apr/10
Sep/09
Feb/09
Jul/08
Dec/07
May/07
Oct/06
Mar/06
Jan/05
Aug/05
Jun/04
Apr/03
Nov/03
Sep/02
Jul/01
Feb/02
Dec/00
Oct/99
May/00
0.0 Mar/99
1.0
-5.00
Oct/99
2.0
0.00
Summary Keppel Corporation Limited SINGAPORE Industrials 12mth Forward PE P/BV (Trailing) Dividend Yield (Trailing) ROE (Trailing) Implied Value of Growth
15935.00 26.35913 SEDOL B1VQ5C0 Industrial Conglomerates Latest Min 5.64 12.09x 0.74 2.05x 0.78 3.67 -0.15 19.48 -1.17 -23.5%
Max 28.20 5.03 8.95 33.06 0.66
Source: Bloomberg, Reuters Global Fundamentals, IBES CONSENSUS, J.P. Morgan Calcs
32
Median 12.52 2.12 3.62 19.12 0.02
Average 12.75 2.11 3.44 17.73 -0.02
2 S.D.+ 19.74 3.98 6.27 34.54 0.53
2 S.D. 5.76 0.24 0.62 0.91 -0.57
% to Min -53% -64% -79% -101% -397%
As Of: Local Price: EPS: % to Max % to Med 133% 4% 145% 4% 144% -1% 70% -2% 381% 107%
* Implied Value Of Growth = (1 - EY/Cost of equity) where cost of equity =Bond Yield + 5.0% (ERP)
11-Apr-14 11.00 0.91 % to Avg 5% 3% -6% -9% 92%
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
Analyst Certification: The research analyst(s) denoted by an “AC” on the cover of this report certifies (or, where multiple research analysts are primarily responsible for this report, the research analyst denoted by an “AC” on the cover or within the document individually certifies, with respect to each security or issuer that the research analyst covers in this research) that: (1) all of the views expressed in this report accurately reflect his or her personal views about any and all of the subject securities or issuers; and (2) no part of any of the research analyst's compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed by the research analyst(s) in this report. For all Korea-based research analysts listed on the front cover, they also certify, as per KOFIA requirements, that their analysis was made in good faith and that the views reflect their own opinion, without undue influence or intervention.
Important Disclosures
Client: J.P. Morgan currently has, or had within the past 12 months, the following company(ies) as clients: Keppel Corporation.
Client/Non-Investment Banking, Securities-Related: J.P. Morgan currently has, or had within the past 12 months, the following company(ies) as clients, and the services provided were non-investment-banking, securities-related: Keppel Corporation.
Non-Investment Banking Compensation: J.P. Morgan has received compensation in the past 12 months for products or services other than investment banking from Keppel Corporation. Company-Specific Disclosures: Important disclosures, including price charts, are available for compendium reports and all J.P. Morgan– covered companies by visiting https://jpmm.com/research/disclosures, calling 1-800-477-0406, or e-mailing [email protected] with your request. J.P. Morgan’s Strategy, Technical, and Quantitative Research teams may screen companies not covered by J.P. Morgan. For important disclosures for these companies, please call 1-800-477-0406 or e-mail [email protected].
Keppel Corporation (KPLM.SI, KEP SP) Price Chart 28
OW S$10.28
OW S$9.5OW S$11OW S$14.1 OW S$12.4
OW S$16.5 21 OW S$10.09
OW S$7N S$7.9OW S$9.7OW S$11.4 OW S$12.8 OW S$13.3
OW S$9.285 OW S$11.62 OW S$17 OW S$16 OW S$12 N S$5.75 OW S$9.7OW S$10.2 OW OW S$15.1 S$13.7 OW S$12.7 Price(S$)
OW S$13.5
14
7
0 Oct 06
Apr 08
Oct 09
Apr 11
Source: Bloomberg and J.P. Morgan; price data adjusted for stock splits and dividends. Initiated coverage Oct 18, 2006.
Oct 12
Apr 14
Date
Rating Share Price Price Target (S$) (S$)
18-Oct-06
OW
7.36
9.28
24-Jan-07
OW
8.79
10.09
06-Mar-07 OW
8.30
10.28
26-Apr-07
OW
10.72
11.62
11-Jun-07
OW
11.80
16.50
28-Sep-07 OW
14.30
17.00
31-Mar-08 OW
9.90
16.00
19-Sep-08 OW
8.70
12.00
23-Oct-08
OW
4.17
7.00
04-Apr-09
N
5.78
5.75
26-May-09 N
7.30
7.90
24-Jul-09
OW
7.98
9.50
23-Oct-09
OW
8.15
9.70
26-Jan-10
OW
8.09
9.70
14-Apr-10
OW
9.42
11.00
16-Jul-10
OW
8.80
10.20
22-Oct-10
OW
9.71
11.40
17-Jan-11
OW
11.46
14.10
04-Apr-11
OW
12.40
15.10
20-Jul-11
OW
10.62
13.70
21-Oct-11
OW
8.78
12.80
07-Jan-12
OW
9.44
12.40
26-Jan-12
OW
10.76
12.70
13-Apr-12
OW
11.24
13.30
13-Jan-14
OW
11.03
13.50
The chart(s) show J.P. Morgan's continuing coverage of the stocks; the current analysts may or may not have covered it over the entire period. J.P. Morgan ratings or designations: OW = Overweight, N= Neutral, UW = Underweight, NR = Not Rated Explanation of Equity Research Ratings, Designations and Analyst(s) Coverage Universe: J.P. Morgan uses the following rating system: Overweight [Over the next six to twelve months, we expect this stock will outperform the 33
Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] Neutral [Over the next six to twelve months, we expect this stock will perform in line with the average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] Underweight [Over the next six to twelve months, we expect this stock will underperform the average total return of the stocks in the analyst’s (or the analyst’s team’s) coverage universe.] Not Rated (NR): J.P. Morgan has removed the rating and, if applicable, the price target, for this stock because of either a lack of a sufficient fundamental basis or for legal, regulatory or policy reasons. The previous rating and, if applicable, the price target, no longer should be relied upon. An NR designation is not a recommendation or a rating. In our Asia (ex-Australia) and U.K. small- and mid-cap equity research, each stock’s expected total return is compared to the expected total return of a benchmark country market index, not to those analysts’ coverage universe. If it does not appear in the Important Disclosures section of this report, the certifying analyst’s coverage universe can be found on J.P. Morgan’s research website, www.jpmorganmarkets.com. Coverage Universe: Mirchandani, Ajay: Aboitiz Power (AP.PS), Bumi Armada Berhad (BUAB.KL), COSCO Corporation (COSC.SI), DMCI Holdings (DMC.PS), Dialog Group Bhd (DIAL.KL), Dyna-Mac Holdings Ltd (DMHL.SI), Electricity Generating Company (EGCO.BK), Energy Development (EDC) Corporation (EDC.PS), Ezion Holdings Ltd (EZHL.SI), Ezra Holdings Ltd (EZRA.SI), Glencore International PLC (0805.HK), Glow Energy (GLOW.BK), Keppel Corporation (KPLM.SI), Linc Energy Ltd (LINC.SI), Malaysia Marine and Heavy Engineering Holdings Bhd (MHEB.KL), Manila Electric Company (MER.PS), Manila Water Company Inc (MWC.PS), Metro Pacific Investments Corp. (MPI.PS), Perisai Petroleum Teknologi Bhd (PPTB.KL), Ratchaburi Electricity Generating Holding (RATC.BK), SapuraKencana Petroleum Bhd (SKPE.KL), Sembcorp Marine (SCMN.SI), Semirara Mining Corp (SCC.PS), Tenaga (TENA.KL), UMW Oil & Gas Corp Bhd (UMOG.KL), Vard Holdings Ltd (VARD.SI), YTL Power (YTLP.KL) J.P. Morgan Equity Research Ratings Distribution, as of March 31, 2014
J.P. Morgan Global Equity Research Coverage IB clients* JPMS Equity Research Coverage IB clients*
Overweight (buy) 44% 58% 45% 78%
Neutral (hold) 44% 49% 48% 67%
Underweight (sell) 11% 40% 7% 60%
*Percentage of investment banking clients in each rating category. For purposes only of FINRA/NYSE ratings distribution rules, our Overweight rating falls into a buy rating category; our Neutral rating falls into a hold rating category; and our Underweight rating falls into a sell rating category. Please note that stocks with an NR designation are not included in the table above.
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Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
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Ajay Mirchandani (65) 6882-2419 [email protected]
Asia Pacific Equity Research 16 April 2014
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