Recovery On Track

Tiêu đề: Recovery On Track Thu 15 Apr 2010 - 0:15

Shipbuilding market seems to have entered a gradual but firm recovery phase.

Seoul-based Hana Daetoo Securities recently upward adjusted its investment opinion on shipbuilding stocks to 'Buy More', saying "New ship ordering has passed the worst and is entering the process of improving."Analyst Jang Geun-ho said, "Newbuilding ordering activity has not reached a sort of 'enough' level yet but the newbuilding price, which is considered as the ultimate index for shipbuilding industry, started to show an upward trend recently."

"There are also many factors coming up, which could stimulate a further rise in ship prices."

Jang added, "While an increasing number of industry players believe that improvement in shipping rates would persist, the increase in secondhand ship sales and purchases, secondhand ship price hike, and recovering new ship ordering activity all will contribute to the rise in newbuilding prices."

"Recent upward movement in raw material prices and appreciation of Chinese yuan and Korean won will also reduce the risks of further fall in new ship prices," he analyzed.

He said shipbuilders' order backlog stability issue still remains in controversy, but improving new ship ordering activity, the most decisive factor for market recovery, should be given attention to.

He recommended Hyundai Mipo Dockyard (HMD) and Hanjin Heavy Industries & Construction (HHIC) stocks as the most promising ones.

Jang said HMD's business stability is high and its stocks are absolutely underestimated. HHIC's share prices had fallen too much while the shipbuilder is recently consolidating the ground for recovery for the long term, he noted. (according to asiasic)

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