UOB Kay Hian
Date of Report: 4 July 2025

Samudera Shipping Line: Riding the Wave of Southeast Asia’s Container Shipping Boom

Overview: Samudera Shipping Line at a Glance

Samudera Shipping Line (SAMU SP), a Singapore-based container shipping specialist, stands out as a major player in the regional feeder service market. The company’s strategic positioning at the heart of Asia’s maritime hub gives it a unique advantage as global supply chains shift towards Southeast Asia. With a robust financial profile and a forward-looking business model, Samudera is poised to capitalize on both cyclical and structural changes in the shipping industry.

Key Facts and Stock Performance

• Share Price: S\$0.86
• Market Cap: S\$462.7 million (US\$363.3 million)
• Bloomberg Ticker: SAMU
• Shares Issued: 538.0 million
• 3-Month Avg Daily Turnover: US\$0.7 million
• 52-Week High/Low: S\$1.05 / S\$0.705
• Major Shareholder: PT Samudera Indonesia TBK (65.3%)
• 2024 NAV/Share: US\$1.08
• 2024 Net Cash/Share: US\$0.47

Business Model: A Leading Regional Feeder Service Provider

Samudera Shipping Line specializes in container feeder services, efficiently connecting the Singapore hub with key spoke ports throughout Asia. The company is estimated to control over 30% of independent feeder-carried container volume at the Port of Singapore. In 2024, container shipping contributed to 92% of Samudera’s revenue and 98% of operating profit, underscoring its core focus and operational excellence.

Benefiting from Global Supply Chain Shifts

The ongoing realignment of global supply chains away from China is a secular trend benefitting Southeast Asia. With competitive labor costs and improving infrastructure, the region is positioned for long-term growth as Western firms seek to diversify. Samudera draws over 80% of its revenue from Southeast Asia, with an additional 17% from the Middle East and Indian Subcontinent, making it ideally placed to capture expanding trade flows and logistics demand arising from the region’s growth.

Short-Term Outlook: Tariff-Driven Frontloading and US Policy Impacts

Recent US tariff policy shifts—and a temporary 90-day reprieve for China exports—have resulted in a rush of US-bound shipments from Asia. This has driven a 6.6% year-on-year container throughput growth at the Port of Singapore in the first five months of 2025, with April and May seeing increases of 7.1% and 8.2% respectively. Large carriers have shifted more capacity to transpacific routes, potentially easing intra-Asia competition and supporting regional freight rates. These trends are expected to underpin Samudera’s financial performance in the first half of 2025.

Global Policy Shifts: US Port Charges on Chinese Vessels

A new US port-fee policy effective October 2025 imposes escalating charges on large, Chinese-built vessels, while exempting smaller ships under 4,000 TEUs and those on short-sea voyages operated by non-Chinese entities. This structure is expected to discourage direct US port calls by large China-linked vessels, incentivizing the use of transshipment and feeder services. While Samudera does not operate transpacific routes, it stands to gain from higher asset values and increased demand for feeder services amid a tightening global supply-demand balance.

Financials: Strong Cash Position and Attractive Valuations

Samudera trades at a compelling 0.62x trailing price-to-book ratio. Its net cash position of US\$252 million (S\$325 million)—representing 69% of its market capitalization—translates to the lowest 2024 ex-net-cash PE and EV/EBIT multiples among peers, at just 1.6x and 1.1x respectively.

Industry Trends: Disruptions as a New Norm and Profit Catalyst

The container shipping sector is inherently cyclical and highly responsive to disruptions—from pandemics and geopolitical tensions to regulatory changes. While such events inject volatility, they have often driven sharp spikes in freight rates and, consequently, profitability. Recent disruptions, including the COVID-19 pandemic, Red Sea tensions, and shifting US tariff policies, have boosted earnings for resilient carriers like Samudera.

In the past five years, these disruptions have become the norm, frequently benefiting the industry despite the instability. Freight rates remain the primary profit driver, and events that restrict supply or trigger demand surges can result in record-high profits for regional carriers.

Peer Comparison: Intra-Asia Liner Standings

Logistics Spending and Trade Lane Growth Projections

Forecasts for 2024-2028 show robust growth in logistics spending across major Southeast Asia trade lanes:

• Intra-Southeast Asia: CAGR 7.6%
• Southeast Asia-China: CAGR 5.6%
• Southeast Asia-US: CAGR 5.8%
• Southeast Asia-Europe: CAGR 8.8%
• Total major lanes: From US\$155.2bn (2021) to US\$267.7bn (2028)

Port of Singapore container throughput continues its long-term upward trend, rising 6.6% year-on-year in the first five months of 2025.

Market Dynamics: Asset Values and Freight Rates

Intra-Asia spot freight rates have rebounded since late March 2025, and rising feeder vessel prices reflect the tight supply-demand balance. Samudera’s balanced fleet (28 self-owned, plus leased vessels) provides flexibility to manage both upswings and downturns.

Corporate Governance and Insider Activity

• CEO Bani Mulia purchased 172,700 shares in the open market at S\$0.795–0.825 between 8 May and 28 May 2025, signaling management’s confidence in the company’s prospects.

Conclusion: Investment Case and Outlook

Samudera Shipping Line offers a compelling investment case, combining strong regional exposure, a solid net cash position, and attractive valuations. While the sector remains exposed to geopolitical risks and tariff policy fluctuations, Samudera’s positioning, operational flexibility, and potential to unlock further shareholder value (including higher dividends) make it a standout among intra-Asia container shipping peers.