By Yi Wei Wong
The shares of Yangzijiang Shipbuilding Holdings Ltd. rose sharply in early trading, after the value of its order book hit a record high, following recent order wins.
The stock rose 6.4% to 1.17 Singapore dollars (US$0.82) early Friday. The shares were trading as recently as S$1.17.
The Singapore-listed shipbuilding company recently landed orders for 22 ships, pushing its order book to $10.27 billion, its highest level ever. New orders indicate the company could be profitable through mid-2025, it said in a statement late Thursday.
“Stricter environmental regulations in recent years have resulted in a growing demand for green ships and we are poised to benefit from this growth,” said Ren Letian, CEO.
Latest order wins indicate the shipbuilder has secured $3.6 billion in year-to-date vessel sales, exceeding Yangzijiang’s fiscal year target of $2.0 billion, Citi analyst Jame Osman said in a note. It also exceeded Citi’s expectations that the company would secure $3.0 billion in orders during the fiscal year.
Citi said there were “several tailwinds” that could improve Yangzijiang’s profit margins, including a stronger dollar against the yuan, lower steel prices and increased demand for the Yangtze’s more expensive ships. shipbuilder.
The US investment bank has a buy rating and target price of S$1.36 for Yangzijiang shares.
Write to Yi Wei Wong at [email protected]