Most of Marco Polo’s assets and people are located on the western coast of Taiwan, away from the city of Hualien, the epicentre, which is on the east coast.
According to Yeo in his April 8 note, there should be no major negative impact on operations for now.
“In addition, project owners are typically required to continue paying for ship charters even if they encounter project delays.
“We believe MPM’s ship chartering contracts are unlikely to be exceptionally different from standard industry practices,” he adds.
That aside, Marco Polo Marine had on March 21 announced it has won an agreement with Siemens Gamesa to provide supply crew transfer vessels for its offshore wind projects in Taiwan and South Korea from 2024 to 2026.
“In view of the new arrangement, we increase our fleet size assumption by two vessels by FY2026.
“We have also imputed slightly better charter rates and margins to reflect the current higher charter rate environment and better operational leverage,” says Yeo, who estimates the company’s FY2025 to FY2026 earnings to increase by 8-10%.
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In line with his earnings upgrade, Yeo's discount cash flow-based target price, based on 11.2x FY25F P/E, is accordingly lifted by 10% to 8.1 cents.
As at 10.18am, Marco Polo Marine shares changed hands at 6.6 cents, unchanged for the day, but up 32% year to date.
