KUALA LUMPUR (Aug 30): Bumi Armada Bhd's shares rose as much as three sen or 6% to 55.5 sen so far today on bargain hunting after the stock's substantial 22% decline yesterday.

Yesterday, Bumi Armada reported a net loss of RM585.48 million in the second quarter ended June 30, 2018 (2QFY18) compared to a net profit of RM116.59 million a year earlier on lower revenue and as the oil and gas support services provider registered impairment charge of RM478.94 million.

Today, the counter was traded at 53.5 sen at 11:22am with some 18 million shares transacted. Investors bargain hunted for the stock today after the shares fell 14.5 sen to close at 52.5 sen yesterday.

In a note today, CIMB Research said it had cut its target price for Bumi Armada shares from 83 sen to 72 sen. "Bumi Armada shocked the market with a huge 2Q18 net loss of RM586 million, due to even more penalty provisions for Kraken (Armada Kraken), which is the only Bumi Armada asset without final acceptance.

"Bumi Armada expects final acceptance within two weeks, a final compensation agreement with EnQuest has already been signed, and the kitchen-sinking was already done in 2Q18.

"We incorporate the penalties and cut our SOP (sum-of-parts)-based target price to 72 sen, but keep an Add as the risks are to the upside, particularly after the sell-off yesterday" CIMB said.