April 27, 2024

• 

[THE INVESTOR] Samsung Heavy Industries’ operating loss in the second quarter was much lower than market expectations, said SK Investment and Securities on July 24, lowering the target price to 7,500 won (US$6.60) from 8,500 won.

It has turned to red with 100.5 billion won operating loss while revenue dropped 41.4 percent on-year to 1.35 trillion won. The size of loss was even larger than the estimated 75.3 billion won, mainly due to the additional 39 billion won loss from drill ship division, said analyst Yoo Seung-woo.

Its order amount has reached only 30 percent of its US$8.2 billion target, the lowest achievement rate among three major shipbuilders in Korea. Losing the bid for Chevron’s floating production storage and offloading project was a serious setback. In commercial vessel sector, operating fare of LNG carriers, one of its flagship models, has taken a downturn from declining demand in Asia, and orders are likely to dwindle, forecast the analyst maintaining a “hold” recommendation. 

By Hwang You-mee (glamazon@heraldcorp.com)