What’s next for Ezion after China wind power project?

Financial woes could greet Ezion in 2016.

The shipping company has found itself in another potential avenue for future growth as it signs a wind power agreement in China.

According to analysts from RHB research, the wind power project agreement could mean more than the near-term for Ezion, as it could lead to new contracts in 1H16.

“We only expect one year of negative earnings growth, caused by the operational issues faced this year, and expect earnings to rebound in FY16 as its newly-delivered liftboats begin work. We view this agreement to be the next engine of growth for Ezion, with new contracts potentially being signed in 1H16,” RHB Research said.

Meanwhile, Ezion’s entry into the wind power market could be a fall back as it languishes in the depressed oil and gas sector.

“Markets are pricing stocks as though oil prices will stay under USD40/bbl for the long term. RHB expects oil prices to rebound to USD50/bbl next year, and USD60/bbl in 2016,” RHB Research added.