KUALA LUMPUR (May 20): Shares of Perisai Petroleum Teknologi Bhd fell 1.96% in late morning trade today, after Hong Leong IB Research maintained its “Sell” rating on Perisai Petroleum Teknologi Bhd with an unchanged target price of 22.5 sen, and said Perisai’s 1QFY16 core PATAMI (excluding RM10.4 million forex loss) stood at RM6.3 million, accounting for 32% and 29% of house and street’s estimates.

At 10.52am, Perisai fell half a sen to 25 sen, with 1.48 million shares traded.

In a note today, the research house said Perisai’s 1QFY16 core earnings weakened 10.7% year-on-year due to 2 major factors: (i) higher discount given for charter rate of Perisai Pacific 101 as a result of oil price slump, and (ii) higher interest cost.

It said Perisai Pacific 102, which is due for delivery in the next two months, would be deferred by the company and that the firm is still in talks with the shipyard for further deferment.

“Delivery date for Perisai Pacific 103 has been further delayed to Oct 16, from July 16 as agreed with the shipyard.

“The group also possesses the put option to dispose off remaining 50% stake in its currently loss-making E3 barge to EMAS offshore, which has been agreed at US$40m, timely for the group under the current turbulence to repay its borrowings.

“We maintain Sell call on the stock, with target price maintained at 22.5 sen, pegged at 0.5x to FY16 BVPS,” it said.