Hibiscus Petroleum Bhd is targeting 15% to 20% growth in both production and sales volumes for FY27 after closing FY26 with stronger-than-expected earnings, according to Hong Leong Investment Bank Bhd (HLIB Research).
HLIB Research said 4Q26 core net profit surged 3.6 times quarter-on-quarter and 75% year-on-year to RM221.4 million, lifting full-year core earnings by 29% to RM386.6 million. The result exceeded both HLIB Research and consensus estimates, mainly due to stronger production.
Quarterly revenue jumped 63.5%, supported by realised oil prices of US$112 per barrel, up 41% from the previous quarter, while sales volume increased 10% to 2.5 million barrels of oil equivalent.
HLIB Research highlighted Brunei as a key contributor, where production rose 52% following the low-pressure compressor project. Output is expected to remain at around 7,600 barrels of oil equivalent per day for at least the next 12 months.
While HLIB Research expects 1Q27 earnings to moderate as oil prices soften, the impact should be cushioned by recovering production following planned maintenance and stable targeted sales volumes. Discussions with potential strategic investors could also provide an additional growth catalyst.
The research house raised its FY27 earnings forecast by 14.7% and maintained its ‘Buy’ call, while increasing its target price to RM2.83 from RM2.74. At a reference price of RM2.05, the target implies 38% capital upside and a total expected return of 42.9% including dividends.
Hibiscus Petroleum’s FY26 dividend reached 10 sen per share compared to 8.5 sen in FY25.
