* Icon Offshore up 12 pct after $295 mln IPO
* Investors banking on strong demand for offshore supply
* To use IPO funds to expand fleet and repay debt
(Recasts on growth outlook, adds fund manager quote)
By Yantoultra Ngui
KUALA LUMPUR, June 25 Malaysia's Icon Offshore
Bhd, whose ships offer support services for oil
platforms, rose 12 percent in its market debut, with investors
keen on its growth outlook given heavy capital spending plans by
state oil firm Petronas.
Icon, 88 percent held by Ekuiti Nasional (Ekuinas), a
government-owned private equity fund, is the country's largest
pure-play offshore service vessel provider, with 32 ships and 14
percent of the domestic market.
It has a young fleet with an average age of 5 years compared
to 11 for Southeast Asian rivals and is well placed to benefit
from Petroliam Nasional Bhd's (Petronas) efforts to
increase oil production. Icon plans to use the $295 million
raised in its IPO to expand its number of ships to 39 and to
"The listing comes at a good time. Oil prices are strong
because of the conflict in Iraq and the global economy looks
pretty good," a local fund manager said, declining to be
identified as he was a buyer of the stock.
Icon's debut should also help continue to keep the focus on
Malaysia's vibrant oil and gas sector, he added.
The stock was trading at 2.08 ringgit on Wednesday morning,
compared with its IPO price of 1.85 ringgit per share. At one
point it rose as high as 2.19 ringgit. The broader market
declined 0.2 percent.
Petronas has targeted capital spending of $19 billion
annually in the five years to 2016, and research firm Infield
Systems has forecast the number of operating oil platforms in
Malaysia will increase to 519 by end-2019 from 406 last year.
Southeast Asia's crude oil demand is expected to rise over
50 percent in the next 20 years, hitting 6.8 million barrels per
day by 2035 according to the International Energy Agency's
energy outlook report released late last year.
Icon announced on Monday a six-fold jump in first-quarter
net profit to 19.5 million ringgit from the same period a year
ago due to a lower tax rate and a 23 percent climb in revenue.
Petronas, however, accounted for 80 percent of Icon's
revenue last year and heavy dependence on the state oil firm
could work against Icon if Petronas decides to scale back its
BNP Paribas, Credit Suisse and Maybank Investment Bank were
joint global co-ordinators of the IPO.
($1 = 3.2170 Malaysian Ringgit)
(Reporting by Yantoultra Ngui; Editing by Edwina Gibbs)