Broker Name: CGS International

Date of Report: January 30, 2026

Excerpt from CGS International report.

Report Summary

• Nam Cheong Limited (NCL) is an offshore services provider focused on oil & gas projects in Malaysia and the Middle East, with a young fleet and an expanding presence in Southeast Asia.
• CGS International initiates coverage with an “Add” rating and a target price of S\$1.87, seeing 57% upside from the current price, based on a 11x FY27F P/E multiple in line with peers.
• NCL is expanding its fleet from 36 to 42 vessels by end-2026, with 64% of vessels on long-term contracts, improving earnings visibility and utilization rates.
• The company is well-positioned to benefit from a global replacement-driven newbuild cycle as OSV fleets age, targeting third-party shipbuilding orders and leveraging its Miri shipyard’s capacity.
• Recent asset sales have unlocked capital for debt reduction and growth initiatives, with further vessel disposals potentially enhancing balance sheet flexibility and supporting dividend resumption.
• Key catalysts include securing new shipbuilding orders, higher-than-expected fleet utilization, adding more vessels, and the potential return of dividends as deleveraging continues.
• Risks include lower offshore capex by oil majors, charter cancellations, or delays in securing newbuild orders, all of which could impact utilization and earnings.
• NCL’s ESG profile is evolving with a focus on safety, fuel-efficient vessel designs, and compliance with environmental standards, though emissions have risen due to fleet growth.
• The report provides detailed financial forecasts, showing a 12% core net profit CAGR over FY25F-27F, supported by revenue growth, margin stability, and improved capital structure.
• Industry outlook is constructive due to aging global fleets and rising offshore activity, especially in Malaysia, supporting further utilization and earnings upside for NCL.

Above is an excerpt from a report by CGS International. Clients of CGS International can be the first to access the full report from the CGS International website: https://www.cgs-cimb.com