Here's the biggest advantage of Singapore yards against Chinese, Korean rivals

Speed is the name of the game.

According to CIMB, Singapore could continue to preserve its market share in the rig market against the Chinese and Korean yards.

In 2H13, Keppel single-handedly dominated about 50% of the 23 jack-up rigs ordered globally, with the other 50% clinched by various Chinese yards.

Speedy delivery while preserving profitability could be the key competitive advantage over the attractive payment terms offered by the Chinese and cut-throat pricing by the Koreans.

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We still like KEP the best among the big-caps. Enquiries are strong and momentum could be sustained with S$6bn-7bn worth of new orders.

We estimate that S$2.4bn of new orders are already in the bag – assuming two out of five options are converted by Transocean (S$600m) and the six jack-up rigs from Pemex (S$1.8bn) are finalised. In the smaller-cap space, we like Ezion for safety considerations.

As Ezion has another nine service rigs coming onstream in 2014, increasing its current rig fleet by 60%, we are forecasting 93% yoy growth in Ezion‟s EPS, which could be the stock‟s key catalyst. We see no reason to own Swiber and Cosco given the lack of earnings visibility and persistently weak execution.