CSE Global Limited new contracts win worth US$33.8m

CSE Global Limited (CSE) announced yesterday that it has secured new contracts worth US$33.8m (~S$45.3m) in 1Q15 from the Americas region. The new orders involve projects requiring system integration solutions provided by CSE, including instrumentation and electrical design, engineering and integration of subsea control systems and equipment and also provision of customized enterprise systems. These projects are expected to contribute positively to CSE’s results for FY15 and beyond, but not expected to have any material impact on its NTA or EPS for FY15. Amidst times when oil & gas majors are reducing capital expenditures resulting from the plunge in oil prices, we think these new greenfield contracts are positive for CSE, on top of its resilient earnings driven by recurring brownfield jobs. As our current model had already factored in for both greenfield and brownfield revenue growth, maintain HOLD with an unchanged FV of S$0.62.