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Brokers' take

Published Thu, Jan 28, 2016 · 09:50 PM

Ezion Holdings | Sell

Target price: S$0.11

Jan 28 close: S$0.49

KGI Fraser, Jan 28

Major offshore E&P companies are slashing budgets by a further 20-30 per cent in 2016, according to Bloomberg Intelligence. This marks the first time since the 1980s where global capex has been reduced for two consecutive years.

We expect a S$700 million writedown (about 30 per cent of total FY16F PPE value, based on current market values) of Ezion's total assets over the next two years. It will lead Ezion's net gearing to rise to 2.8x, well ab…