Marco Polo Marine - UOB Kay Hian 2024-04-11: Virtual Call Takeaways ~ Thriving On Upswing In Offshore Industry

• Marco Polo Marine (SGX:5LY) has highlighted the promising future of offshore wind with rising global capacity targets. Average dayrates and utilisation rates are also likely to remain on the uptrend, supported by growing demand and limited vessel supply.
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Charter & utilisation rates for OSVs continue upward momentum

• Charter and utilisation rates for OSVs (offshore support vessel) continue upward momentum, underpinned by higher offshore drilling activity. According to Clarksons Research, global offshore support vessel utilisation stood at 73% in 2023, while dayrates have surpassed previous peaks in 2013-14. On top of this, OSV supply has dropped 5% from 2017 as newbuilds are minimal from limited bank financing.
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Capturing growth in APAC offshore wind capacity.

• In the Global Wind Energy Council’s (GWEC) view, global installed offshore wind capacity is expected to grow by more than five-fold to 447 GW by end-32, with nearly 50% from APAC. This is mainly driven by Taiwan, whose National Development Council is targeting an ambitious 5.7GW offshore wind generation capacity by 2025 and 20.5GW by 2035 in pursuit of net zero carbon emissions.
• Marco Polo Marine has established a long track record from supporting the offshore wind market in Taiwan via Oceanic Crown Offshore Marine Services and PKR Offshore, and continues to expand its presence with its new commissioning service operation vessel (CSOV) slated to be operational in 2H24. We think that this is key leverage for Marco Polo Marine to achieve growth with Taiwan’s burgeoning offshore windfarm projects.

Maiden deployment of new CSOV and CTV in FY25 may unlock more opportunities.

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Heidi Mo UOB Kay Hian Research | John Cheong UOB Kay Hian | https://research.uobkayhian.com/ 2024-04-11 SGinvestors.io

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