Singapore, Jan 20, 2025 — The marine sector is riding a tidal wave of growth, with Singapore-listed marine stocks showing robust gains over the past year. Analysts predict a favorable outlook, fueled by a combination of industry upcycles, supply constraints, and burgeoning demand for greener vessels and fleet renewal programs.
Stock Performance Highlights Yangzijiang Shipbuilding emerged as a star performer, with its share price surging nearly 80% in the last year. Seatrium followed closely, with a 52% jump in the past six months, while Nam Cheong soared an impressive 150% over the same period. Marco Polo Marine also saw healthy growth, climbing more than 12%.
Driving Forces: A Perfect Storm for Growth Lim Siew Khee, head of Singapore research at CGS International, attributed the boom to increased shipping activity post-COVID-19, elevated freight rates, and robust balance sheets among ship liners. “This has led to record-high orders for shipyards like Yangzijiang,” Lim said, adding that most shipyard capacities are booked until 2028.
The supply crunch in offshore support vessels, a critical component in oil and gas exploration, has further buoyed the sector. Vessel charter rates have more than doubled since 2021, benefiting players like Nam Cheong, Mermaid Maritime, and Marco Polo Marine.
A Greener Fleet and LNG Boom The International Maritime Organization’s sulfur emission regulations (IMO 2020) continue to drive demand for dual-fuel and eco-friendly vessels. Analysts noted a surge in interest for liquefied natural gas (LNG) carriers, with Singapore shipbuilders poised to capitalize on the shift.
“Singapore, Korea, and increasingly Chinese shipyards, are fully booked until at least 2027, with demand outstripping supply. Newbuild prices are climbing, and steel prices are soft due to a weaker Chinese economy,” said Ng Xin-Yao, investment director at abrdn. This confluence of factors promises stable revenue and cash flow for years to come, he added.
Oil & Gas Investments Add Fuel Floating production storage and offloading (FPSO) units are gaining traction, supported by oil prices stabilizing between US$70 and US$90 per barrel. These price levels have encouraged oil producers to increase capital expenditure, pushing FPSO orders higher globally.
Seatrium has been a key beneficiary, securing over S$16 billion worth of contracts for Petrobras P-series FPSO platforms and offshore converter platforms. Marco Polo Marine is also poised for strong contributions from its Commissioning Service Operation vessel in H2 FY2025, with resilient charter rates driven by offshore wind farms and oil and gas demand.
What Lies Ahead? Analysts are optimistic about continued growth. Yangzijiang stands out with a solid order book extending to 2029 and potential order wins surpassing last year’s US$4.5 billion target. Meanwhile, Seatrium and other service companies are expected to thrive as vessel deliveries ramp up.
As the marine sector navigates this transformative phase, investors are eyeing opportunities in shipbuilders and service providers that can ride the waves of this sustained upcycle.
Bottom Line: With the global marine industry charting a path toward growth, Singapore’s shipbuilders are firmly anchored in a position to capitalize on rising demand, setting the stage for a decade-long boom.
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