Korea Investment & Securities maintained its target stock price of 33,000 won and investment opinion "buy", saying it won a large-scale construction project worth 1 billion dollars for Samsung Engineering.
"It announced that it has won an order for the construction of the Zapra gas treatment facility from Saudi Arabia's Aramco through a public announcement," Korea Investment & Securities said.
"The expected construction cost was $1 billion, which was selected as the lowest bidder in a commercial bid and even signed the final order contract.".
Korea Investment & Securities said, "The cumulative amount of new orders in the third quarter was 4.4 trillion won, and including orders for the Jafurah Gas Processing project, it reached 5.4 trillion won, which is 90% of the annual order target.".
Korea Investment & Securities also added, "Jafurah field is a gas field located in the southeastern part of the Gawar oil field, and this project is a facility that handles gas collected from the Jafurah gas field and will build seven related facilities, including two 1.1 billion standard cubic-foot gas separation trains a day.".
Korea Investment & Securities said, "Starting with the Jafurah project, large-scale construction orders planned by major oil-producing countries in the Middle East are expected to appear one after another," adding, "The construction that can be expected by the end of this year or early next year will be Aramco's Zuluf Oil Field Development Project.".
"It is important for Samsung Engineering to continue to make profits by winning orders as an EPC (design, procurement and construction) company that achieves a 10% stable GP margin (sales gross profit) in overseas construction," Korea Investment & Securities added.
"In addition to construction orders, the stable process at existing sites, including Mexico's DBNR, is a factor that makes us expect an increase in sales and margins next year," said Korea Investment & Securities.
Reporter Lee Dong-hoon firstname.lastname@example.org