KUALA LUMPUR, May 7 — Research houses are upbeat on MISC Bhd’s earnings outlook, citing the expectation of increased global oil demand which will lead to better tanker rates and resumption of refining operations which will help petroleum tankers as positive catalysts.

Maybank Investment Bank said MISC’s earnings could be better in the second to fourth quarters of this year, as tanker rates may improve following the resumption of refining activities as key economies reopen and the Organisation of the Petroleum Exporting Countries Plus (Opec+) increase production by two million barrels per day from May to July 2021.

On MISC’s results for the first quarter ended March 31, 2021 (Q1 2021) released yesterday, Maybank said it was in line with expectations. 

"Sequential earnings may improve on better tanker rates and contribution from its new very large ethane carrier vessels. We maintain our earnings forecast, and ‘buy’ call with a target price (TP) of RM7.75,” it said in a research note today.

MISC returned to the black in Q1 2021, registering a net profit of RM429.80 million compared with a net loss of RM1.16 billion recorded in the same quarter last year.

Meanwhile, MIDF Research said upon effective global vaccine inoculation programme, it is postulated that the recovery in the oil and gas sector will be gradual and more muted in the first half of this year, picking up steam in the second half year.

Furthermore, the expected ease in Opec+ cuts in May onwards will be a tailwind for the tanker players. Both factors would hopefully translate to an increase in refinery activities in the second half of 2021, which would positively benefit demand for tankers.

Meanwhile, Kenanga Investment Bank Bhd said moving forward, spot tanker rates still remained sluggish, although it is mildly sanguine of a slightly stronger second half year, given the increase in oil production globally, led by Opec+.

At 12.30pm, MISC shares decreased four sen to RM6.73. — Bernama