[Click e-Stock] "HMM Expected to Face Intensified Short-Term Market Volatility"

LS Securities predicted on May 15 that short-term volatility in HMM's market conditions will intensify.

Lee Jaehyuk, a researcher at LS Securities, stated, "Recently, the Shanghai Containerized Freight Index (SCFI) has been moving sideways around the 1,300 level. We expect short-term volatility in the container shipping market to intensify for the time being." He explained, "Concerns over shipping demand triggered by tariffs imposed by the Trump administration have caused a short-term demand gap in the market. In this situation, with the recent 90-day tariff suspension, there is a possibility that peak season demand for the third quarter of 2025 will enter the market earlier than usual."

He added, "Due to the cascading effect from shipping companies adjusting supply on China?North America routes, changes in supply-demand conditions on European, Asian, and North-South routes are also inevitable."

Lee further commented, "Despite the announcement of a US?Houthi ceasefire agreement, the policy of shipping companies to detour around the Suez Canal is likely to continue throughout 2025. Recently, the China Containerized Freight Index (CCFI) has retreated to the 1,100 level, and with the continued delivery of new container ships, the increase in shipping capacity is expected to form a major downward trend in market conditions."

The buy investment rating and target price of 19,000 won for HMM were maintained.

Lee explained, "The planned buyback and cancellation of treasury shares worth 2 trillion won is a highly anticipated event for the year. Although concerns about a market downturn persist, it is positive that the long-term contracts for North America and Europe scheduled for this year were completed as planned."