Langsat Terminal to Take Shape Yesterday, Dialog announced that 55%-owned Centralised Terminals SB (CTSB) will establish a JV company with China Aviation Oil (Singapore) Corp Ltd (CAO) called Langsat Terminal (Three) SB (Langsat Terminal 3) to undertake the proposed design, development, operation, management and maintenance of a 380k m3- capacity oil storage tank terminal facility near Tanjung Langsat Port in Johor. Construction is expected to commence by early 2012 for completion by end-2013 at a total development cost of about RM371m. We are positive on this development. Maintain Buy.
Maintain Buy. We remain positive on the construction of Langsat Terminal 3 as it will provide more recurring income and a constant future cash flow so that Dialog can deploy more capex and take on higher risk projects such as marginal oilfields. The total capacity of Langsat Terminal 1-3 will be about 1m m3. Our fair value for Dialog has also been upgraded to RM3.66 (previously RM3.43), based on a sum-of-parts valuation after including Langsat Terminal 3’s contribution. We continue to like Dialog as it is one of the most defensive O&G stocks in its sector.
Maintain Buy. We remain positive on the construction of Langsat Terminal 3 as it will provide more recurring income and a constant future cash flow so that Dialog can deploy more capex and take on higher risk projects such as marginal oilfields. The total capacity of Langsat Terminal 1-3 will be about 1m m3. Our fair value for Dialog has also been upgraded to RM3.66 (previously RM3.43), based on a sum-of-parts valuation after including Langsat Terminal 3’s contribution. We continue to like Dialog as it is one of the most defensive O&G stocks in its sector.
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