Seatrium(US:SMBMY) Xin Hua Cai Jing·2025-11-14 08:20Core Viewpoint - Despite facing significant challenges, including contract terminations, OCBC Investment Research maintains a "buy" rating for Seatrium Limited with a target price of SGD 2.76 [1][2] Group 1: Contract Termination and Challenges - Seatrium recently received a contract termination notice from Maersk Offshore Wind regarding the "Sturgeon" wind turbine installation vessel, valued at approximately USD 475 million (SGD 610 million), with 98.9% of the project completed and originally scheduled for delivery in January 2026 [1] - The company's net order value decreased from SGD 18.6 billion in the first half of 2025 to SGD 16.6 billion, primarily due to a slowdown in securing new contracts [2] - Seatrium also received an arbitration notice from Keppel seeking SGD 68.4 million in compensation related to the "Operation Car Wash" corruption investigation in Brazil [2] Group 2: Long-term Outlook and Operational Performance - OCBC has incorporated potential provisions and expectations of slowed order growth into their analysis while maintaining the "buy" rating and fair value estimate of SGD 2.76 [2] - The long-term development trajectory of Seatrium, particularly its FY2028 targets (including an EBITDA of at least SGD 1 billion and a return on equity of no less than 8%), remains largely unchanged [2] - In the third quarter of 2025, Seatrium demonstrated confidence in operational performance, successfully delivering two projects and expecting three more by year-end, while completing maintenance and upgrades on 47 vessels [2] - The company has raised over SGD 140 million through the divestment of non-core assets, including a surplus shipyard in the U.S. [2]