CIMB starts STX OSV (MS7.SG) at Outperform with a $1.60 target, based on 11x CY12 P/E (a 10% discount to rigbuilders’ 5-year mean).

“STX OSV is a designer and shipbuilder of high-end, customized offshore support vessels. With nine shipyards in four countries, it has exposure to global E&P spending,” the house says.

It adds, the stock is trading at 8x CY12 P/E, in line with local OSV builders’ 5-year trading average.

“We argue that closer comparables should be rigbuilders, Keppel Corp (BN4.SG) and SembCorp Marine (S51.SG), which are trading above their 5-year P/E mean valuations. We believe that STX OSV, as the only other mid-cap investment apart from Ezra (5DN.SG), is the next most-valued proxy for the global E&P recovery.”

The house tips stock catalysts from higher-than-expected orders and results (4Q earnings due February 15). Shares are up 2.6% at $1.18.