Dyna-Mac is a frontrunner in the O&G industry, poised to benefit from the ongoing supercycle. Specializing in topside module fabrication for FPSOs, Dyna-Mac has secured substantial orders and expanded operational capacity. With FPSO charter rates rising and a strong pipeline of FPSOs, Dyna-Mac is expected to secure additional orders in FY24, leading to margin expansion and increased revenues and profitability.
Despite the industry’s underinvestment, Dyna-Mac is well-placed to capitalize on the resurgence in capital expenditure by oil majors. The company’s operations are operating at full capacity, prompting them to secure additional space from neighboring yards. The growing order book and recent land acquisition further support Dyna-Mac’s profitability.
In their latest 2H23 results, Dyna-Mac reported significant improvements in revenue and net profit, attributed to higher progressive recognition from projects executed. With a market cap of $368.1 million and trading at 14.3x FY24 PE, Dyna-Mac presents an attractive investment opportunity with a BUY recommendation and a target price of $0.45. – from LimTan