At the briefing, Marco Polo shared that it is “actively pursuing” shipbuilding contracts, noting that it had two empty construction slots in its yard for this purpose.
To Kande and Lim, Marco Polo’s new $198 million newbuild order for a research vessel from Taiwan’s National Academy of Marine Research shows the company’s capability to secure orders beyond traditional oil and gas sectors.
“Management also noted strong enquiries for repair work and is prioritising higher value repair contracts preferably under long-term master service agreements, such as the one it signed with Cyan Renewables (Unlisted) in August 2025 extending over three years,” the analysts write.
At the briefing, Marco Polo’s management also shared that it was in “promising” discussions with offshore wind players to secure a long-term charter contract and likely to be signed by 1Q2026. The CSOV is on track for delivery in mid-FY2028 and is expected to be deployed immediately for work in Taiwan, Kande and Lim note.
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“Given the advanced specifications for its second CSOV, we assume long-term charter day rates will be 40%-50% higher than the US$45,000 ($58,391.13) day rate for its first CSOV, which it signed a contract for in 2023,” they write.
“Marco Polo has a partnership with K-Line Wind Service in Japan and is in the process of setting up an office in Korea, which should position it well to pursue work in these nascent offshore wind markets, expanding its coverage beyond Taiwan, in our view,” they add.
In addition to their higher target price, the analysts have increased their FY2026 to FY2028 estimates by 4% to 13% as they factor in more front-loaded revenue recognition for its Taiwan newbuild contract, which has been guided by the company’s management. The analysts’ estimates also include two more newbuild contracts worth $130 million each over FY2026 to FY2028.
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To them, potential earnings upside could come from a higher-than-expected contract value for newbuild orders.
With their forecast net profit which has a compound annual growth rate (CAGR) of 25% over FY2025 to FY2028, Kande and Lim have maintained their “add” call on the counter.
Their new target price is based on an FY2027 P/E of 18 times from 13 times P/E before, compared to a P/E of 10 times and a three-year earnings CAGR of 8% for Marco Polo’s peers.
The analysts have also identified re-rating catalysts such as a charter contract win for its second CSOV, further shipbuilding contracts, and the listing of its Taiwan subsidiary.
“We also see a potential re-rating from greater interest from institutional investors in light of Singapore’s Equity Market Development Programme (EQDP),” they write.
Meanwhile, a lower-than-expected yard and, or fleet utilisation and delays in offshore wind projects affecting vessel demand are downside risks.
As at 11.33am, shares in Marco Polo Marine are trading above CGSI’s previous target price at 15 cents, or 202% up year to date.
