Stock Upgraded: Ezra Holding target price raise to 4.25 by JP Morgan

JP Morgan has increased its price target for Ezra Holdings Ltd to 4.25 sgd from 3.00 and stood by its "overweight" call on the stock in view of the firm's robust growth strategy. "Ezra has recorded recent high yielding wins of long-term charter contracts and set up appropriate financing structures to fund its growth," JP Morgan said in a client note. "We believe long-term charter contracts and the company's aggressive fleet expansion plans (fueled by sale and lease back arrangements) would lend firm support to our valuations," it added. Yesterday, Ezra announced it won a contract worth a maximum 397.25 mln usd for the long-term charter of a floating production storage and offloading (FPSO) facility for operation in Southeast Asia and expects to secure another FPSO charter contract in the next 12 months. JP Morgan said Ezra will likely earn net profit of around 50 mln sgd annually during the four-year contract period for its latest FPSO order. The research house has increased its net profit estimates for Ezra to 74. 4 mln sgd from 59.7 mln for the year to August 2007, and to 103.8 mln from 72. 5 mln for the following fiscal year. At 9.27 am, Ezra was up 0.14 sgd or 4.14 pct at 3.52 with 370,000 shares traded.