Buy Sime Darby: ECM Libra

ECM Libra Investment Research has maintained a "buy" call on Sime Darby Bhd with a target price of RM11.80, following confirmation that it is bidding for the Telok gas development project.

Last week, it was reported that the Telok gas development had taken off with ExxonMobil and Petronas Carigali in the lead.

"The project is currently in the front end engineering and design stage. Telok will be developed via two remote satellite platforms to be tied back to the existing Guntong gas hub," ECM Libra said in a research note today.

It added that the platforms are expected to be fabricated at Sime Darby's Pasir Gudang yard in Johor.

"The scope of the project involves the procurement, construction, and hook up and commissioning of the Telok A and Telok B topsides and jackets.

"Given the 18-month duration of the job, we view that this contract could be worth RM500 million to RM800 million in value," ECM Libra explained. - Bernama