Corporate Logo(source: hmm21.com)
Sangsangin Securities initiated coverage on HMM(011200) with a neutral rating on March 11, citing the potential for indirect benefits from U.S. regulations on Chinese shipping companies and the expectation of shareholder returns.
Lee Seo-yeon, an analyst at Sangsangin Securities, stated, "If the U.S. Trade Representative(USTR) implements port fee charges on Chinese shipping companies and Chinese-made vessels, 83% of container ships calling at U.S. ports would be impacted." The target price for HMM was set at 23,000 won.
The analyst noted, "Currently, 73% of the container ship order backlog consists of Chinese-made vessels, and it would be difficult to completely mitigate the impact of such regulations due to large-scale order cancellations." She added, "If the regulations are implemented, a short-term increase in costs for global container shipping companies and a rise in freight rates due to the pass-through effect to shippers are expected."
However, Lee pointed out that HMM has a 0% share of Chinese-made vessels in its order backlog, which is significantly lower than its global competitors, suggesting that HMM could see indirect benefits from the regulations.
Regarding HMM's shareholder return plan of 2.5 trillion won, the analyst noted, "Considering that HMM has already implemented a dividend of 600 won per share, totaling 528.6 billion won for 2024, it is expected that share buybacks worth approximately 2 trillion won will occur during the year." She also mentioned, "Assuming the conversion of convertible bonds(CBs) due in April for KDB Bank and Korea Ocean Business Corporation, the total number of HMM's outstanding shares will increase by about 10%, but most of this increase can be offset by share buybacks."
*[KOSPI]HMM(011200) is a comprehensive logistics company that came under the management of creditors such as Korea Development Bank and Korea Ocean Business Corporation due to the liquidity crisis in 2016. Market capitalization is 19 trillion 515 billion won(as of March 10, 2025, closing price).
Corporate Logo(source: hmm21.com)
Sangsangin Securities initiated coverage on HMM(011200) with a neutral rating on March 11, citing the potential for indirect benefits from U.S. regulations on Chinese shipping companies and the expectation of shareholder returns.
Lee Seo-yeon, an analyst at Sangsangin Securities, stated, "If the U.S. Trade Representative(USTR) implements port fee charges on Chinese shipping companies and Chinese-made vessels, 83% of container ships calling at U.S. ports would be impacted." The target price for HMM was set at 23,000 won.
The analyst noted, "Currently, 73% of the container ship order backlog consists of Chinese-made vessels, and it would be difficult to completely mitigate the impact of such regulations due to large-scale order cancellations." She added, "If the regulations are implemented, a short-term increase in costs for global container shipping companies and a rise in freight rates due to the pass-through effect to shippers are expected."
However, Lee pointed out that HMM has a 0% share of Chinese-made vessels in its order backlog, which is significantly lower than its global competitors, suggesting that HMM could see indirect benefits from the regulations.
Regarding HMM's shareholder return plan of 2.5 trillion won, the analyst noted, "Considering that HMM has already implemented a dividend of 600 won per share, totaling 528.6 billion won for 2024, it is expected that share buybacks worth approximately 2 trillion won will occur during the year." She also mentioned, "Assuming the conversion of convertible bonds(CBs) due in April for KDB Bank and Korea Ocean Business Corporation, the total number of HMM's outstanding shares will increase by about 10%, but most of this increase can be offset by share buybacks."
*[KOSPI]HMM(011200) is a comprehensive logistics company that came under the management of creditors such as Korea Development Bank and Korea Ocean Business Corporation due to the liquidity crisis in 2016. Market capitalization is 19 trillion 515 billion won(as of March 10, 2025, closing price).