It pays to read the last Sunday's Edge interview with Bumi Armada's CEO Hassan Assad Basma. "In the oil & gas business,.....when you are No.1, you are the prize taker." (You have to be NO.1 to win contracts if you venture into the international arena). Icon's business, it seems is highly dependent on Petronas & only operates in shallow waters.

The shallow waters is already crowded with many players. While its earnings might be steady & this, I believe, has already reflected in its IPO price. Now the question is where is the growth? It can venture into the international arena like Bumi Amarda. But to do this requires a huge capital & returns might not be that great. Bumi Amarda is an international player but if you look at its EPS, its earnings are not that great in spite of the contracts worth billlions that it secured.

The role of the stablizing manager is to try to maintain the IPO price for a specific duration of time after which the share would be left to market forces to decide. Stabilizing the price does not mean pushing up the price for retail investors to make money. It would be financially unsound for the stabilizing manager to do this.
The fact is that the IPO has already fully valued. If it can show growth in its EPS looking forward, then its value should increase.
Buying a fully valued share means that you have a small chance of making money.

Not surprised as this is a capital-intensive industry.

prospective EPS for 2014 - 9.2 cents (TA Research). It also said Icon is diversifying into deep water segment. If you look at Bumi Armada which is already in the deep water segment, you will know there won't be a big increase in EPS.

Most O & G counters down. For the first time since 2008, the price of oil is predicted to drop towards $80 per barrel. This means oil exploration & drilling would like to come to a standstill. Thus less jobs to O & G firms. Besides most O & G firms are overvalued.

Nothing can survive a regional selldown. There is room for the KLCI to drop further as it broke its important support level. I presume 40 more points to go.

It will be a long wait. That is why institutional funds are selling.

When oil drops to USD20, I will buy.

This has happened from 1986 to 2004 when price ranged from USD21 to USD48, apart from two aberrations during the 1998 Russian crisis & the 1991 Iraq war. If I can recall, the glut was created by Norway & North Sea oil fields. Of course no one wants to think of this scenario. Not even the government.

In Dakota USA which accounts for 50% of US shale oil, USD42 is still profitable. Shale oil production can be turned on or off more easily than conventional oil fields which in a sense, make them the 'swing producers' shutting off when not profitable n turning the taps on when profitable. Seen fr this angle, USD50 to USD 70 could well be the ceiling not the floor price. If the sector is bad, shares which have links with the sector would be bearish. This is one of the views. The other being a proxy fight in the Middle East involving Saudi Arabia which is aiming at Iran n Russia. But this objective cannot be achieved in a few months. You can consider your options basing on this angle