[Click eStock] Daishin "Lowered Pan Ocean Target Price, but Right Time to Increase Weight"

[Asia Economy Reporter Ji Yeon-jin] Daishin Securities announced on the 23rd that it has lowered the target price for Pan Ocean to 8,500 KRW, considering market concerns about the dry bulk shipping market and the current price gap.

Pan Ocean's sales in the fourth quarter of this year are expected to increase by 109.4% year-on-year to 1.2993 trillion KRW, and operating profit is expected to rise by 109.4% to 228 billion KRW, exceeding market expectations by more than 20%. This is the highest level since the first quarter of 2008.

The average Baltic Dry Index (BDI) for the fourth quarter of this year is projected to be 3,400 points, a 150% increase compared to the same period last year, and the annual average BDI for next year is expected to be 3,360 points, 15.2% higher than this year's 2,916 points. As of the end of the fourth quarter, the company has 62 long-term charters of more than one year, an increase of 10 vessels compared to the end of the third quarter. The break-even point (BEP) BDI for long-term charters is estimated to be around 2,100 points.

Yang Ji-hwan, a researcher at Daishin Securities, said, "Despite solid performance, the stock price continues to adjust due to deteriorating investor sentiment following the correction in the dry bulk market since mid-October, and the current stock price is only 0.7 times the price-to-book ratio (PBR) based on next year." He added, "A dividend payment of 100 KRW per share is expected this year, along with plans to enhance shareholder value, and we believe that from December this year to January next year is the optimal period to increase holdings."