Date of Report

October 1, 2024

Broker Name

UOB Kay Hian

Company Overview

Yangzijiang Shipbuilding is a leading shipbuilding company based in China, specializing in the construction of a wide range of vessels, including bulk carriers, container ships, and specialized vessels.

Recent Developments

The report notes that the Chinese government has introduced significant stimulus measures aimed at boosting economic activity. These initiatives are expected to positively impact various sectors, including shipbuilding, as increased government spending and infrastructure development could lead to higher demand for new vessels.

Revenue Exposure to China

Yangzijiang has substantial revenue exposure to the Chinese market. The company is well-positioned to benefit from the anticipated uptick in orders and increased activity in the maritime sector due to the recent economic stimulus. The improved economic environment is likely to encourage both domestic and international shipping companies to invest in new ships.

Investment Recommendation

• Recommendation: BUY
• Current Price (S$): 2.45
• Target Price (S$): 3.40
• Potential Upside (%): 38.8%

Market Context

With the economic stimulus in place, Yangzijiang is expected to see a recovery in its order book as shipping demand rebounds. The company’s competitive position in the shipbuilding market, combined with the government’s supportive policies, places it in a strong position to capitalize on the upcoming growth in the industry.

Conclusion

Yangzijiang’s strategic focus on shipbuilding and its exposure to the revitalizing Chinese economy make it an attractive investment opportunity. The anticipated growth in the maritime sector, driven by government initiatives, positions Yangzijiang for significant expansion in the near future.