PublicInvest Research said Sapura’s liquidity constraints raised questions on its ability to take on such sizeable contract values even if some clients provided advances to ensure the successful completion of these projects.

It was announced today that Sapura Energy’s wholly owned subsidiaries had secured 10 contract wins worth RM1.4 billion across the Asia Pacific and Atlantic regions between December 2022 and May 2023.

At RM979 million, the engineering and construction business segment has the lion’s share of the new contracts. The drilling segment has been awarded contracts worth RM352 million and operations and maintenance has the rest of it, which comes up to RM34 million.

PublicInvest noted that Sapura Energy’s orderbook has surged nonetheless. With the addition of the new contracts, its orderbook now has contracts worth RM7 billion until the fourth quarter of 2023, up from RM5.6 billion previously.

It also took note of the fact that Sapura Energy has also been granted a third extension for its debt restructuring exercise as it continues to seek extension from regulators for submission of its PN17 regularisation plan.

The research firm maintained its “underperform” call on the integrated oil and gas services company’s shares with the target price of two sen per unit.

News of it winning the new contracts also led to heavy trading of its shares this morning.

By 10.08am, the counter’s share price had risen half-a-sen to four sen with 96.05 million shares transacted.

Just an hour later, 235 million shares had been traded, more than six times its average daily trading volume.