SINGAPORE (June 10): RHB Research is keeping its “buy” call on Keppel Corp with a lower target price of $7.33 from $7.92 previously.
In a Monday report, analyst Leng Seng Choon says, “We like Keppel for its potential for prime landbank-value unlocking in China and Vietnam. Its O&M division would see recovery in contract flows, with FPSO conversion jobs expected to pick up in 2019, after securing $1.8 billion of 2019 O&M orderbook YTD (exceeding $1.7 billion for FY18).”
In the mid-to-long term, the group is targeting ROE of 15%, by being a powerhouse of urbanisation solutions. It believes that this is a realistic target, given the average 17.7% ROE recorded from 2009 to 2018.