Serica's capital markets day left Panmure Liberum analyst Ashley Kelty sufficiently impressed that the broker raised its forecasts and upgraded its price target, to 353p from 342p.
Kelty has repeated a Buy recommendation, pointing to the London‑listed North Sea oil and gas group's enlarged asset portfolio after three 2025 acquisitions.
The analyst also highlighted "stronger" near‑term production (year‑to‑date averaging 43,300 barrels oil equivalent per day, boepd, with Q2 seen above 49,000), as well as a material net‑debt reduction, down to about $72m from ~$200m at end‑December.
Moreover, he noted the recent bond issue which also helped elevate liquidity to $684m.
Panmure's note highlights an updated capital allocation policy, to return 15-30% of post‑tax free cash flow, and also flags the positive, mitigating effect that comes from Serica's large pool of carried‑forward tax losses, and soaring hydrocarbon prices, which together help offset what's generously described as "UK fiscal drag".
Looking to operations, Kelty highlights that securing a rig for an infill programme at the Bruce field will be a potential catalyst and value driver, alongside anticipated production uplifts from Kyla (part of the Triton Hub), Glendronach and Tormore.
Investors are steered to look out for news of rig awards and signposts along the delivery of the infill and redevelopment programmes, which Panmure Liberum expects should convert the enlarged portfolio into organic production growth over the coming 12-24 months.
