[Click eStock] "Daewoo Shipbuilding & Marine Engineering Holds High Technological Competitiveness in LNG Equipment"

Hana Financial Investment Report "LNG Facility-Related Orders to Increase Further"

[Asia Economy Reporter Minji Lee] Hana Financial Investment maintained a buy rating and a target price of 40,000 KRW on Daewoo Shipbuilding & Marine Engineering (DSME) on the 9th, expecting it to secure orders for various types of LNG facilities based on its high technological competitiveness.

[Image source=Yonhap News]

DSME secured an order for an ultra-large LNG storage facility worth 360 million USD per unit from a Russian shipowner. The LNG storage facilities ordered this time are expected to be installed in 2022 at Murmansk and the Kamchatka Sea area, which serve as intermediate stops to export LNG produced from the Yamal project to Europe and Asia.

Park Muhyun, a researcher at Hana Financial Investment, said, "Since the total order volume includes four units with two option contracts, profitability is expected to be very good," and added, "The LNG market is gaining attention not only for traditional power generation purposes but also as LNG fuel for ships, so orders for various types of LNG facilities are expected to increase gradually."

The number of LNG bunkering ports increased from 75 in September last year to 81 currently. Considering that the delivery volume of LNG-powered ships from domestic shipyards continues to increase, the number of LNG bunkering ports is expected to grow further. As the LNG ship fuel market expands, demand for storage structures to store LNG also rises.

Researcher Park said, "DSME has a full LNG lineup including LNG carriers, LNG-RVs, LNG-FSRUs, and LNG-FSUs for transportation, storage, and regasification," and explained, "It is the only company in the world with delivery records of large icebreaking LNG carriers, indicating high technological competitiveness."

He continued, "It is known that each shipyard will secure orders for 45 Qatar LNG carriers," and said, "News of orders for large LNG structures will enhance the company's effect of repeated construction of the same ship type, contributing to increasing shipbuilding margins."