Contents
2H09 shipbuilding sector strategy – offshore plant and wind power
momentum
3
Could maritime trade contraction be any worse? 5
New orders decline, meaningful 2H09 improvement unlikely 6
Order backlogs declining quickly 7
Ranking of order backlog indicates business viability 8
Raw material prices stabilize downward 9
Vessel prices drop, but the amount of the fall uncertain 10
Orders plummet; delivery capacity grows 13
Offshore plant, BIG3 league of their own (Ⅰ) 14
Offshore plant, BIG3 league of their own (Ⅱ) 15
1) Offshore plant star : SHI 16
2) Offshore plant star : DSME 17
3) Offshore plant star : HHI 18
Valuation comparison with global peers 19
Big 3 to bottom out in 1Q09 21
The impact of forex rate fluctuations to decrease 22
Appendix : Top 5 Korean shipbuilders’ investment indexes 25
Top picks
Hyundai Heavy Industries (009540 KS) – BUY, Fair Value W340,000
Samsung Heavy Industries (010140 KS) – BUY, Fair Value W44,500
DSME (042660 KS) – BUY, Fair Value W33,000
STX Offshore & Shipbuilding (067250 KS) – HOLD, Fair Value W21,000
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