Ramunia bullish on more jobs
The Star(StarBiz)
19 November 2007

THE loss of a major contract some months back does not dent Ramunia Holdings Bhd's confidence in winning more and bigger jobs locally and abroad.  

“We are entering into a very bullish period. We hope to see our overseas ventures start bearing fruit (securing contracts) in the next few weeks,” its finance director Mohamad Reezal Siddiq told StarBiz. 

Ramunia is now bidding for contracts worth RM7bil to fill its order book, which stands at about RM400mil. “The results of some of our bids will be known in a few weeks' time,” said Reezal, adding that it hoped to secure a few sizeable jobs.  

Ramunia, which has the second-largest oil and gas fabrication yard in Asia, is well positioned to take up new jobs. 

“We have lots of capacity to offer. That allows us to be aggressive in bidding for jobs,” said Reezal.  

The company operates at a 30% utilisation rate after it expanded fabrication capacity two months ago to 84 tonnes from 30 tonnes previously.  

With the additional capacity, Ramunia promises its clients fast delivery – something its rivals would have problems with due to capacity constraint. Thus, the company could have premium pricing for its jobs, Razeel added.  

The management is optimistic of Ramunia's prospects. But looking at its share price performance, the investing public seems to think otherwise.  

The stock sank after it lost the RM308mil contract awarded by Carigali-PTTEPI Operating Company Sdn Bhd (CPOC), a joint venture between Thai-based PTTEP International Ltd and Petronas Carigali (JDA) Sdn Bhd.  

Like it or not, there were doubts about its credibility and ability to deliver. Its share price slid to 76 sen in August from the peak of RM1.68. The counter closed at RM1.14 last Friday. 

“It is only commercial disagreement on pricing, not non-performance. Our ability will be proven when we announce new contracts soon,” replied Razeel when asked why the CPOC contract was terminated.  

He added that Ramunia would receive a lump sum from CPOC for the work and resources that it had mobilised at the initial stage of the project.