UOB Kay Hian (UOBKH) analyst Adrian Loh maintains his “buy” rating and $3.15 target price in his June 2 report. Describing Seatrium’s 1QFY2026 as “solid”, Loh notes management’s guidance for higher gross margins due to a better project mix and completion of non-core divestments.
He sees room for growth for earlier gross margin estimation of 7.5% and expects the current energy shock to reinforce energy security concerns and longer-term offshore energy investment, which could benefit Seatrium.
To Loh, Seatrium is a contender for major energy projects in the offshore space. “Seatrium’s four TenneT offshore platform projects and the heavy-lift vessel for Penta-Ocean are strong proof points that the company should be in the conversation for any major offshore wind tender in the EU.”
Buoyant repairs and upgrades
For Maybank’s Hussaini Saifee, while large project awards remain lumpy, he sees a bright spot in Seatrium’s repairs and upgrades which could throw a positive surprise. Repeat business remains strong, defence-related work is meaningful, and rig refurbishment remains active across Brazil, Singapore and Asia-Pacific, notes Hussaini in a June 1 report.
He also thinks that conversions of floating storage and regasification units and floating liquified natural liquified gas vessels appear to be gaining strategic relevance, supported by energy security, faster time-to-market and LNG infrastructure needs.
Similar to Hussaini, Ho Pei Hwa from DBS Group Research is positive on the repairs and upgrades segment in her May 29 report. She believes that the company is reinforcing its position in LNG and gas infrastructure conversion solutions with Seatrium securing its eighth FSRU conversion project from Karpowership.
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Contract wins as price catalyst
Contract wins is emerging as a common theme as a price catalyst for the counter across most analyst reports. Ho, for one, writes that contract flows remain the key catalyst with the absence of major sizeable projects during the first five months of the year indicating that contract flow has been relatively slow.
Despite slower contract wins, Ho holds an overall constructive contract win outlook as Seatrium could potentially benefit from the emerging global offshore reinvestment cycle. Ho values Seatrium at unchanged $3 and reiterates her “buy” call. in her May 29 report.
Meanwhile Hussaini sees customers still exercising discipline on capex and final investment decision (FID) timing which is outside of Seatrium’s control. As such, material order conversion will likely be more visible only in 2HFY2026 and FY2027. He maintains both his “buy” call and $3.10 target price.
Similarly, CGS International’s Lim Siew Khee and Meghana Kande believe that orderbook replenishment is crucial to meeting 2028 “steady-state” targets of $10 billion to $12 billion revenue, an ebitda of over $1 billion, a return on equity (ROE) of over 8% and a net debt to ebitda of 2.0 to 3.0 times.
Lim and Kande note that Seatrium has lowered its tender pipeline to $28 billion from $32 billion q-o-q. This is due to Petrobras awarding the SEAP 1 FPSO project to SBM Offshore under a build, operate and transfer (BOT) model, instead of Seatrium’s strength in engineering, procurement, construction and commissioning (EPCC).
With five months passing in 2026 and no major contract wins, Lim and Kande decrease their order win forecast from $6 billion to $4.3 billion for FY2026 and trimming FY2027-2028 forecast earnings per share by 2-3%. They maintain their “add” rating at a lower target price of $2.52 (down from previous $2.84), valuing the company at 1.2 times forecasted FY2026 P/B in their May 29 note.
