[Seoul=Newsis] HD Hyundai shipbuilding is on the rise and leading the way in the shipbuilding industry, which is the main business of the Hyundai Group.
According to the Corporate Analysis Research Center on the 21st, among 76 major domestic corporations, HD Hyundai Group ranked 6th with a market capitalization of 53.2 trillion won, following Samsung Group (721.5 trillion won), SK Group (247.2 trillion won), LG Group (163.3 trillion won), Hyundai Motor Group (160.2 trillion won), and POSCO Group (69.5 trillion won).
In particular, its market capitalization has increased by a significant 56.8% (19.2 trillion won) from the beginning of the year, jumping 4 spots from 10th place in market capitalization rankings to 6th place.
In May, HD Hyundai Marine Solutions was listed and the stock price of HD Hyundai Electric soared due to the rise in demand for AI infrastructure, contributing to this success. Nonetheless, the increasing strength in shipbuilding cannot be overlooked.
As shipbuilding affiliates have been resurrecting, HD Hyundai Shipbuilding, the holding company of the shipbuilding sector, achieved its annual order target ahead of schedule within just 6 months. HD Hyundai Shipbuilding secured orders for a total of 144 vessels (including 1 marine facility) this year, totaling $16.27 billion and exceeding the annual target of $13.5 billion by 120.5%.
Having achieved the annual target for the 4th consecutive year since 2021, it surpassed the target before other major shipbuilding companies in Korea. The global shipbuilding industry is being evaluated as entering a new super cycle after passing through a long period of downturn.
It is expected that the performance will also be greatly improved. Financial information company FNGuide predicted HD Hyundai Shipbuilding’s second-quarter revenue to be 6.337 trillion won, and operating profit to be 264.5 billion won, increases of 10.6% and 271.1% respectively compared to the previous year.
In particular, among the three shipbuilding affiliates, HD Hyundai Mipo, which recorded a deficit in the first quarter, is expected to turn profitable in the second quarter. HD Hyundai Mipo has transformed into a shipyard specializing in repairing and converting medium-sized vessels. Currently, it mainly builds medium-sized chemical tankers and container ships.
With recent increases in new ship prices, profits for chemical tankers have been improving. In February, switching to high-priced manufacturing from low-priced contracts due to termination of cargo-passenger ship contracts has been a positive factor.
On the 8th, the price of a chemical tanker ordered by an Oceania-based shipping company reached approximately 74.75 billion won per vessel, setting a new record high. Including 39 chemical tankers ordered so far this year, HD Hyundai Mipo has received a total of 52 orders for ships announced publicly, surpassing the annual record of 51 vessels set in 2017.
Kang Kyung-tae, a researcher at Korea Investment & Securities, commented that “with the successful order performance in the first half of the year, the trend towards long-term profitability improvement has become more apparent,” adding, “having secured ships for the main affiliates until 2026-2027, it is important that they have been able to raise ship prices even for the same type and design with each new order.”
He further added, “HD Hyundai Mipo, which has significantly widened its profitability gap, HD Hyundai Samho showing signs of profitability normalization, HD Hyundai Heavy Industries, which is expected to benefit from the acquisition of STX Heavy Industries, and Hyundai Shipbuilding benefiting from the expansion of small and medium-sized ship engine production capacity due to the acquisition of STX Heavy Industries, all show promising performances.”
Meanwhile, HD Hyundai Vice Chairman Jung Gi-seok has been steadily purchasing HD Hyundai shares since May, setting an example of strengthening responsible management intentions.