See what's driving Keppel Corporation's positive outlook

Margins rising, "healthy" rig demand forecasted.

OCBC predicts Keppel Corporation will continue to secure orders under its effective Near Market, Near Customer strategy, backed by a hungry demand from offshore & marine customers.

"We continue to see good prospects in the O&M sector with the healthy rig demand, and expect the group to continue with its Near Market, Near Customer strategy," said OCBC.

The outlook came as Keppel Corporation reported reported a 8.4% YoY fall in revenue to S$2.95b but saw a 32.1% increase in net profit to S$457.6m in 3Q13, such that 9M13 net profit accounted for 77% of OCBC's full year estimates.

"Stripping out one-off items, we estimate recurring net profit at S$396m, in line with expectations. Operating margin in the O&M segment was strong at 16.5% in 3Q13, much higher than 2Q13’s 14.2%," said OCBC.

"Order flow YTD has also been healthy, with Keppel Corporation securing about S$5b new orders so far vs our full year estimate of S$6b. The net order book stood at a record S$13.6b as at end September," it added.