$YANGZIJIANG SHIPBLDG HLDGS LTD(BS6.SI)$at its 52-weeks high!!!
Yangzijiang Shipbuilding has recently obtained the GTT license for the construction of vessels using industry benchmark GTT Mark III membrane technology. This showcases Yangzijiang’s technical capability to build large LNG carriers. The space is currently dominated by Korean shipbuilders, who have 80-90% of market share. GTT is the global market leader in containment system technology for LNG carriers, controlling over 70% of the market based on the current global LNG fleet – including Liquefied Natural Gas Carriers (LNGC); floating LNG production, storage, and offloading (FLNG); and floating storage and regasification units (FSRU).
Yangzijiang would be the first non-SOE Chinese shipyard to be added to the GTT licensed yard list. Now, it is well positioned to secure its maiden LNG carrier order with this GTT accreditation and their earlier delivery slots in 2025. LNG carrier is one of the highest value commercial vessels with highest barrier to entry. A 170- 180cbm LNG carrier newbuild unit would cost ~US$250m. This will not only be the next growth driver for Yangzijiang but also a critical development in its clean vessel transformation, riding on robust demand for LNG carriers and trend towards cleaner LNG dual-fuel vessels.
TradeWinds reported that Mediterranean Shipping Co (MSC) has struck a deal with Yangzijiang to build a dozen 16,000 TEU LNG dual-fuel containerships worth at least US$2.16bn. Assuming this includes options, 6 firm orders would imply a value of almost US$1.1bn, which is still very sizeable. Furthermore, Yangzijiang benefits from the US$ appreciation, as revenue is predominantly in US$, while reporting is done in RMB.
The share price is currently at its 52-week high and the potential entry in LNG Shipbuilding would be a critical catalyst for the company as the Russia-Ukraine war continues.
So you have this in your portfolio or watchlist?? Do take note of this rising star!!
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