UOB Kay Hian Research 2015-06-25: Ezra - Maintain HOLD with cum-rights target price of S$0.31

Ezra Holdings - Not out of the woods yet; a sale-andleaseback of the Lewek Constellation could be on the cards. 

FY15F PE (x): 18.4
FY16F PE (x): 20.3

• Ezra’s cash call has lifted its refinancing risks. 
• However, its high gearing of 1.27x amidst the current industry downturn and a high cost structure make the situation challenging. A possible sale & leaseback of the Lewek Constellation would unlock US$200m in equity to bolster internal liquidity. 
• On the flipside, the high vessel dayrate will add to cost burden. 
• Subsea outlook has deteriorated. We cut FY15/FY16 earnings estimates by 35- 47%. 
• Maintain HOLD with cum-rights target price of S$0.31. 

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