OCBC keeps Rotary Engineering (R07.SG) at Buy, raises fair value estimate to $1.22 from $1.16 following revisions to earnings projections after firm wins US$250 million ($325.4 million) contract to build petroleum storage facility in Middle East. 

Says work expected to commence 1Q11, completion slated for 4Q12, thereby boosting group’s FY11-FY12 revenue, earnings. “This latest order represents one of the group’s larger contracts and we expect it to boost Rotary’s presence in the Middle East.” 

 

Revises up FY11, FY12 earnings estimates by 10%, 18%, respectively, tips 27.4% growth in FY11 earnings to $70.6 million. “With this latest win, we estimate that the group’s order book now stands at $1.3 billion (vs S$0.9 billion as of August), with visibility extending till 2012.” Group’s 3Q10 results expected November 4. Shares +0.5% at $1.00 after rising 4.2% yesterday on order news.