Friday, June 24, 2011

Yangzijiang shares underestimated

Barclays Capital has branded shares in Yangzijiang Shipbuilding as too cheap after the privately-run large shipbuilder grabbed its second giant containership order in just two weeks.

Peter Dohle has penned an LOI for eight 10,000-teu vessels at the yard hot on the heels of it landing a potential $2.5bn contract for up to 25 10,000-teu vessels with Seaspan.

News of the latest capture, which is supported by a $1bn finance string from China Development Bank, failed to ignite Yangzijiang’s shares in Singapore yesterday.

Jon Windham of Barclays Capital said in a note to clients: “YZJ is too cheap for a yard winning this many orders.”

He notes the Seaspan and Dohle contracts have swelled the Yangzijiang’s orderbook, which sat at $5.4bn at the end of the first quarter, by 28%.

Windam, who describes the Dohle deal as a “significant win” for the yard, added: “We continue to view YZJ as the best positioned of the listed Chinese shipyards to win further container orders in 2011, given its proven track record in delivering quality vessels on-time.”

Published : June 24, 2011

Source: Asiasis


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