SINGAPORE (Sept 30): UOB Kay Hian on Friday maintained its “hold” call on Ezion Holdings, and raised its target price to 30 cents from 23 cents previously.

Ezion’s earnings appear to have bottomed out in 2Q16, notes UOB lead analyst Foo Zhi Wei.

“Management has been nimble with its strategy, venturing into the wind farm industry to mitigate the downturn,” says Foo.

According to Foo, sources have confirmed the deployment of Ezion’s Atlantic Amsterdam (Unit #8) for a 16-month contract for DONG Energy UK in the North Sea. The rig has been on-site and in operation since Aug 27 for an offshore windfarm installation project.

Foo is optimistic for a 3Q16 quarter-on-quarter earnings boost, as the deployment of Unit #8 a month earlier than expected will contribute a full month of earnings.

Barring any surprise expenses and the working status of the 17 units, Foo expects a quarter-on-quarter earnings improvement.

“As earnings gradually decouple from the oil and gas industry, we expect a valuation re-rating at some point,” he adds.

Ezion’s 2016 core earnings projections are now raised 1% from US$52 million ($71 million) to US$53 million, mainly due to timing differences in revenue recognition. According to Foo, forecasts for 2017 to 2018 earnings remain unchanged.

As at 1.24pm, shares of Ezion are down 1.75% at 28 cents.