CIMB has initiated coverage of Hiap Seng Engineering (510.SG) at “outperform” with target price of $1.15 based on 11x FY11 P/E; citing catalysts from stronger-than-expected orders wins, sustainable margins, according to Dow Jones.

“As oil prices stabilise, as many as seven mega-projects could be reignited on (Singapore’s) Jurong Island with estimated contract values of $8.8 billion,” says CIMB; projects 35% three-year earnings CAGR on back of $225–$250 million order wins assumed for FY11-12.

Notes, backed by strong net cash position, company now among cheapest offshore & marine stocks under its coverage; 6.3x 2011 P/E vs 8.7x peer average. Stock +3.8% at 68.5 cents.