Restructuring will save the day.
After Ezra reported its first loss since its listing, fears are rife that the group might eventually go bankrupt.
However, analysts at RHB Research believe that despite Ezra’s subdued outlook, the group will be able to keep its head above water in coming quarters.
“Ezra’s shares, now trading at 0.141x P/BV (the third decimal place has become significant), imply market expectations of the group facing bankruptcy. However, with Ezra having already performed a rights issue and sold half of its subsea business – and is now working with its banks to restructure its borrowings to delay principal repayments – we believe such fears are overdone,” said RHB.
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