Kenanga Investment Bank Bhd (Kenanga Research) has maintained its OUTPERFORM rating on Yinson Holdings Bhd, increasing its target price (TP) to RM3.87 from RM3.60, an 8% rise. This comes after the company reported a strong nine-month financial year of 2025 (9MFY25) performance, surpassing expectations, driven by rate increases for the floating production storage and offloading (FPSO) Abigail Joseph and contributions from FPSO Maria Quiteria. The research house has raised its FY25/26 earnings forecast by 14%, bolstering confidence in the company’s future growth.
The 9MFY25 core profit of RM384 million exceeded Kenanga Research’s expectations, accounting for 82% of the full-year forecast. This outperformance was attributed to rate escalation from FPSO Abigail Joseph, which had a positive impact on Yinson’s core earnings. The research house also announced a single interim dividend of 1 sen per share. Despite a 31% year-on-year drop in revenue, mainly due to the completion of the FPSO Maria Quiteria project, core profits surged by 40%, helped by stronger lease income.
Kenanga Research highlights the continued strong performance of Yinson’s FPSO projects, particularly FPSO Maria Quiteria, which began contributing lease income after its first oil production on Oct 15, 2024. Additionally, the group anticipates that FPSO Atlanta will hit first oil by 4QFY25F, while FPSO Enauta is expected to achieve the same by the same period, with a project completion rate of 98%. The company is also progressing in its green technology initiatives, including its solar project in Peru and the expansion of its EV leasing arm, driveEV, which saw a 273% increase in fleet size to 231 units.
In its investment case, Kenanga Research remains optimistic about Yinson’s future, pointing to its robust FPSO order book and strong project execution track record, positioning the company to benefit from increasing demand in the oil and gas sector. Furthermore, Yinson’s investments in green technology, such as solar and e-mobility, are seen as pivotal for the company’s long-term energy transition strategy.
Source: By Business Today Editorial