[Click eStock] "Sejin Heavy Industries, World's Largest Equipment Capacity... Target Price 9,000 Won"

Stable Growth in the Shipbuilding Industry and Expansion of Client Base
Highlighting the World's No.1 Tank and Cabin Manufacturer
Annual Sales of 500 Billion KRW with 20% Increase in Production Capacity

On the 29th, DS Investment & Securities newly issued a 'Buy' rating and a target price of 9,000 KRW for Sejin Heavy Industries, highlighting its status as the world's largest equipment production capacity.

Yang Hyung-mo, a researcher at DS Investment & Securities, stated, "Sejin Heavy Industries has emerged as one of the few equipment suppliers capable of meeting delivery deadlines and handling volume despite the surge in shipbuilding orders after COVID-19, driven by stable growth in the shipbuilding industry and expansion of its clients. It has become possible to supply to Hanwha Ocean and Samsung Heavy Industries, which were previously difficult to deliver to. The initial tank volume has already been delivered to Samsung Heavy Industries, and orders from Hanwha Ocean are also expected. In addition to LPG tanks, there is a high possibility of securing orders for deck houses and tanks for LCo2 vessels, which are expected to see increased orders in the future."

Sejin Heavy Industries is the world's number one tank and cabin manufacturer. Located near the Hyundai Heavy Industries Group, it has grown by receiving a stable supply of volume. Most domestic and international equipment suppliers, other than Sejin Heavy Industries, went bankrupt during the shipbuilding downturn. Researcher Yang said, "Although shipyards can technically internalize tanks and cabins, outsourcing to equipment suppliers is advantageous in terms of cost and yard efficiency," adding, "The investment point is diversification of customers."

Sejin Heavy Industries' headquarters site covers 150,000 pyeong (approximately 495,867 square meters). It can record annual sales of 400 to 450 billion KRW. It invested 18 billion KRW in 2022 and 45 billion KRW last year to modernize and acquire new factories. Through this, production capacity is expected to expand by more than 20%. Sales exceeding 500 billion KRW can be anticipated, and it has secured capacity to handle volume when the big cycle arrives. Additionally, it can utilize a 100,000 pyeong (approximately 330,578 square meters) site owned by its affiliates in the Gangyangwoobong area, boasting the world's largest equipment production capacity. Researcher Yang explained, "The world's largest production capacity is also an investment point."