A panoramic view of Samsung Heavy Industries’ Geoje Shipyard./Provided by Samsung Heavy Industries
“Isn’t the shipbuilding industry entering a certain cycle? “I’m looking forward to a stunning revival like in 2007.”
Shipbuilding stock investors smiled brightly on the Korean stock market on the 18th. The catalyst was the expectation that the trade war between the US and China, which is happening in semiconductors and electric vehicles, would transfer to the shipbuilding industry.
On the 17th, the White House announced that it was investigating China’s unfair trade practices in the shipbuilding, maritime and logistics sectors. This follows a petition by five unions, including the United Steelworkers (PDC), to the Joe Biden administration to investigate the Chinese government’s unfair trade practices.
On this day, the stock prices of industries related to shipbuilding increased in the domestic stock market due to good news from the United States. If the US keeps the Chinese shipbuilding industry, which has the largest share of the global market, in check, Korean shipbuilders can expect a comeback. On this day, the combined purchasing power of foreigners and institutions led the stock price to rise.
Graphics = Chosun Jeong Daun Design Lab
In particular, on this day, Samsung Heavy Industries, one of Korea’s Big 3 shipbuilding companies, rose more than 12% during the day, reaching a 52-week high (KRW 9,710). A storm of buying continued throughout the day, with daily trading volume exceeding 38 million shares. Foreigners made net purchases of over 108.4 billion won on this day alone, ranking first in net purchases by foreigners based on KOSPI. It was more than the net purchase amount of Samsung Electronics, which came in second (81.7 billion won). According to the Korea Exchange on the 18th, Samsung Heavy Industries’ net purchase amount of 108.4 billion won by foreigners is the highest since its listing in 1994. The closing price of Samsung Heavy Industries on this day was 9,540 won, up 9.8% from the previous day.
Hanwha Ocean (formerly Daewoo Shipbuilding & Marine Engineering) closed the day at 33,300 won, up nearly 15%, recovering its market capitalization to about 10 trillion won. This is the first time Hanwha Ocean’s market capitalization has risen above 10 trillion won since the announcement of a paid-up capital increase of 2 trillion won in August last year. HD Hyundai Heavy Industries, with a market capitalization of over 10 trillion won, also rose 8% on the day and closed at 120,300 won. HD Korea Shipbuilding and Marine Engineering closed at 119,400, up 6.3% from the previous day, and HD Hyundai Mipo closed at 64,900, up 9.8%.
Ulsan Heavy Industries HD Hyundai Ulsan Shipyard Site./Reporter Oh Jong-chan
It was an exciting day for small and medium shipbuilding stocks too. Sejin Heavy Industries rose to 7,440 intraday gains, hitting a 52-week high, and STX Heavy Industries also rose to 14,400 intraday gains. Stocks related to shipbuilding equipment such as Hyundai Hims (7.5%), Sungkwang Bend (6.9%), Hankook Carbon (6%), and Dongseong Finetech (5.4%) also rose significantly.
Exchange traded funds (ETFs) that include stocks linked to the shipbuilding industry also showed sharp gains on this day. The SOL Shipbuilding TOP3 Plus ETF rose 11% during the day, reaching its highest price since launch (10,410 won) (closing price was 10,230 won), and the HANARO Fn Shipbuilding ETF also rose almost 7%, closing at 10,675 won.
Ha Geon-hyeong, a researcher at Shinhan Investment & Securities, said in a recent appearance on Chosun Ilbo Money, the official YouTube channel of the Chosun Ilbo Economic Department, “The bio and shipbuilding industries will benefit from the conflict between the US and China ( G2).” “The United States has begun to regulate industries other than Chinese semiconductors, and biotechnology and shipbuilding are industries where China has ranked high in global exports,” he said.
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