Technical tracker - HLIB Retail Research – 28 September 2021 | HLeBroking

Technical tracker - HLIB Retail Research – 28 September 2021

HIBISCS (RM0.665-Non-Rated) – Good proxy for higher oil prices

Listed in 2011, HIBISCUS is one of the pure play exploration & production (E&P) companies, principally engage in the exploration, development and production of oil and gas.

Over the past 4-week, oil prices has resumed its upward trajectory on the back of supply disruption due to the Hurricane Ida, reflation trade activities by investors, higher demand worldwide with the easing of pandemic restrictions, as well as difficulty in raising output from the OPEC+ as under-investment or maintenance delays persist from the pandemic. Being an E&P player, HIBISCUS is deemed to be a great proxy for higher oil prices.

Moreover, upon the completion of the proposed acquisition of high-quality offshore O&G assets in Malaysia and Vietnam from Repsol (purchase consideration ~USD213m in June 2021) by end 2021, HIBISCS daily net oil and gas output is expected to triple to 26,800 barrel of oil equivalent (BOE) per day, while its 2P net entitlement reserve will increase by more than 1.5 times. In anticipation of buoyant oil prices in the next 2-3 years (consensus Brent oil USD72.12 to USD 63.1 for 2021-2023) as well as the earnings consolidation from Repsol assets from 2HFY22, HIBISCS earnings is expected to enjoy a massive surge of 89% CAGR from FY21-23.

After falling 15.3% from 52-week high of RM0.785 to RM0.665 yesterday, we reckon that the risk-reward is getting attractive as the HIBISCS is currently only trading at 5.7x FY22E P/E (46.7% lower than its 5-years average of 10.7).Technically, the stock is poised for a downtrend reversal in anticipation of a double bottom formation soon. A successful breakout above its neckline (RM0.67) will spur the prices toward RM0.70-0.74-0.785 territory. Cut lost at RM0.625.

Collection range: RM0.635-0.65-0.665

Upside targets: RM0.70-0.74-0.785

Cut: RM0.625

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*Technical tracker - HLIB Retail Research – 28 September 2021*

*HIBISCS（RM0.665-Non Rated）——油价上涨的受益者*

* HIBISCUS 于 2011 年上市，是挖掘与生产 (E&P) 的公司之一，主要从事石油和天然气的挖掘、开发和生产。*

*在过去的 4 周中，由于艾达飓风导致供应中断、加上疫情活动限制的重新开放导致全球原油需求增加和OPEC+难以提高产量的原因，油价已进入了上升趋势。作为 E&P 上游油气公司，HIBISCUS 被认为是油价上涨的主要受益。*

*此外，预计年底完成的拟议收购（收购代价约为 2.13 亿美元），将从 Repsol 获取马来西亚和越南的油气资产，使HIBISCS 每日的石油和天然气净产量提升两倍至 26,800 桶 （BOE），而其 2P net entitlement reserve将增加 1.5 倍以上。 在预计未来 2-3 年油价的上涨（2021-2023 年布伦特原油共识价格为 72.12 美元至 63.1 美元）以及 2HFY22 的 Repsol 资产收益总合的帮助下，将帮助 HIBISCS 大幅提升其业务收入（21-23 财年的复合年增长率为 89%）*

*Hibiscus从52 周的高位RM0.785下跌 15.3% 至 昨日的RM0.665后，风险回报显得相当诱人，因为 HIBISCS 目前仅交易于5.7 倍的 FY22E P/E（比5年平均低了46.7%） ，其5 年平均值为 10.7。从技术分析上，由于目前处于双底有待突破的阶段，若股价成功突破其阻力点RM0.67 后，有望继续上探至 RM0.70-0.74-0.785 的区域。 投资者可以把止损设置在RM0.625.*

*买入范围：RM0.635-0.65-0.665*

*上行目标：RM0.70-0.74-0.785*

*止损：RM0.625*

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