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Dyna-Mac to enjoy synergies with new substantial shareholder Hanwha, says Maybank Securities

The Edge Singapore
The Edge Singapore  • 2 min read
Dyna-Mac to enjoy synergies with new substantial shareholder Hanwha, says Maybank Securities
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Maybank Securities' Jarick Seet has maintained his "buy" call and 46 cents target price on Dyna-Mac Holdings NO4 -

after Korean shipbuilder Hanwha Group emerged as a new substantial shareholder, taking over from Keppel.

Keppel, having exited the offshore and marine business, has been expected to gradually divest its remaining assets in this industry deemed non-core, including Dyna-Mac.

On May 10, Keppel, which first invested in Dyna-Mac back in 2011 for 35 cents each, sold its stake of 23.9% stake for $100 million, which is at a premium of 10% over last Friday's market price.

"We believe this is a key positive as it removes an overhang, as Keppel had already stated its intentions to sell all its non-core assets," says Seet.

Hanwha Ocean provides one-stop solutions for top and bottom structures, including FPSO, which is in the same business as Dyna-Mac. 

Seet believes that Hanwha and Dyna-Mac could form partnerships and create synergies that both parties could benefit from in the booming FPSO space. 

See also: Citi cuts Seatrium’s adjusted profit forecasts, lowers TP to $1.96 after new investigations into Operation Car Wash

"Hanwha Ocean’s investment also represents firm confirmation by one of the industry’s largest players of Dyna-Mac’s value and potential," he adds.

Dyna-Mac's order book now stands at around $896 million, with deliveries stretching to 2026.

The company's share price has gained 27.6% year to date and Seet expects that despite so, Dyna-Mac will continue to benefit from the strong demand for FPSO and continue to re-rate as it executes its larger-size contracts and achieves higher profitability.

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