Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Equity Bottom-Up

Institutional investors have long shied away from owning <a href="https://www.smartkarma.com/entities/15428" target="_blank" data-smartkarma-citation="entities:15428:1">Evergreen Marine Corp Ltd (2603 TT)</a> for two reasons unrelated to the container shipping sector's chronically weak earnings:<ol><li>Concerns about potential conflicts of interest between the Listco and its founding family</li><li>A Group structure that is perceived to be opaque or at least unnecessarily complex</li></ol>In this note we strive to show that investor concerns about potential conflicts and a lack of transparency are misplaced. We believe the interests of the Listco (Evergreen Marine Corp., or EMC) and its founding family are closely aligned, and EMC's earnings results seem to bear this out. Furthermore, a bit of digging shows that the basic Group structure is in fact quite uncomplicated, and the improvement in Taiwan's reporting standards over the years means that investors can obtain a clear picture of the EMC's financial status every quarter.We believe EMC is unjustifiably cheap relative to some of its closest Asian peers. At its current price, EMC presents an attractive way to play a recovery in the rapidly consolidating container shipping industry. We have set a target price of NT$16 per share and recommend investors buy EMC on dips.

Institutional investors have long shied away from owning Evergreen Marine Corp Ltd (2603 TT) for two reasons unrelated to the container shipping sector's chronically weak earnings:Concerns about potential conflicts of interest between the Listco and its founding familyA Group structure that is perceived to be opaque or at least unnecessarily complexIn this note we strive to show that investor concerns about potential conflicts and a lack of transparency are misplaced. We believe the interests of the Listco (Evergreen Marine Corp., or EMC) and its founding family are closely aligned, and EMC's earnings results seem to bear this out. Furthermore, a bit of digging shows that the basic Group structure is in fact quite uncomplicated, and the improvement in Taiwan's reporting standards over the years means that investors can obtain a clear picture of the EMC's financial status every quarter.We believe EMC is unjustifiably cheap relative to some of its closest Asian peers. At its current price, EMC presents an attractive way to play a recovery in the rapidly consolidating container shipping industry. We have set a target price of NT$16 per share and recommend investors buy EMC on dips. 

Evergreen Marine: Not Really So Complex After All, & Cheap on EV/Capacity

Taiwan

Central Reinsurance Co., Ltd. provides reinsurance services.  The Company offers fire, marine, cargo, auto, healthcare, and life reinsurance services.

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Central Reinsurance (2851 TT)

Evergreen Marine: Not Really So Complex After All, & Cheap on EV/Capacity

Institutional investors have long shied away from owning Evergreen Marine Corp Ltd (2603 TT) for two reasons unrelated to the container shipping...

Daniel Hellberg

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