Equity Research Analyst, Maritime sector, Drewry Maritime Financial Research

Ankush Kathuria CFA, FRM

Equity Research Analyst, Maritime sector

Maritime Sector, Equity & Credit Research

Drewry Maritime Financial Research

With no ties to other players in the shipping, finance or banking world, we provide a uniquely impartial view of the markets and companies we cover. Our parent organization, Drewry is a leading independent provider of research services to the maritime and shipping industry, employing over 100 professionals across an international network of offices in London, Delhi, Singapore and Shanghai. Combining our market-leading resources with seasoned sector expertise DFRS offers a highly differentiated and comprehensive range of investment and financial research services to lenders and prospective investors in publicly listed maritime and shipping companies. The full service of reports, supporting resources and sector orientated webinars provides our clients with the most complete picture of the organisations under coverage as is possible. We have been charting and analysing the world’s maritime markets for more than 40 years. This unrivalled intelligence and understanding provides the foundation of our research service. Our analysts have access to one of the most up-to-date, comprehensive and reliable sources of market insight and research data available today. We look at globally listed companies within the following sectors: Port Operators, Container Shipping, Container Manufacturing & Leasing, LNG Shipping, Dry Bulk Shipping and Tanker Shipping. Combine in-depth sector expertise with financial analysis focusing on over 50 stocks globally.

Equity Bottom-Up

Cosco Shipping Ports(1199 HK) – Drawing Ocean alliance to back latest acquisitionCosco Shipping Ports (CSP) increases exposure to the Mediterranean Sea with the acquisition of Noatum Port Holdings (NPH). The Chinese port operator will acquire 51% stake in the Spanish holding company for EUR 203.5m, translating to 14.5x EV/EBITDA. The westward portfolio expansion follows equity stakes in Vado Container Terminal (Italy) and Euromax Container Terminal (Netherlands) in 2016, and complements its…

Cosco Shipping Ports(1199 HK) – Drawing Ocean alliance to back latest acquisitionCosco Shipping Ports (CSP) increases exposure to the Mediterranean Sea with the acquisition of Noatum Port Holdings (NPH). The Chinese port operator will acquire 51% stake in the Spanish holding company for EUR 203.5m, translating to 14.5x EV/EBITDA. The westward portfolio expansion follows equity stakes in Vado Container Terminal (Italy) and Euromax Container Terminal (Netherlands) in 2016, and complements its…

Cosco Shipping Ports (1199 HK) – Drawing Ocean Alliance to Back Latest Acquisition

Transport Sector, China and Asia-focused Research

Charles De Trenck

There is a philosophical debate to be had over changes in COSCO Shipping Ports (formerly COSCO Pacific) financial accounts as a result of 2015-16 restructuring. The conclusion is the investor generally lost ground – and the share price hasn’t reflected any of the changes! It has simply meandered.  2017-19 will have to be a period of strong growth, or investors will be in a position of having bought new assets with little accretive returns. In this note, we piece apart the financials of before and after reorganization based on the face value financials.

There is a philosophical debate to be had over changes in COSCO Shipping Ports (formerly COSCO Pacific) financial accounts as a result of 2015-16 restructuring. The conclusion is the investor generally lost ground – and the share price hasn’t reflected any of the changes! It has simply meandered.  2017-19 will have to be a period of strong growth, or investors will be in a position of having bought new assets with little accretive returns. In this note, we piece apart the financials of before and after reorganization based on the face value financials.

COSCO Shipping Ports' Faustian Bargain and Impact of Restructuring on 2016 Financials

Thematic (Sector/Industry)

Chinese Port Operators - Core Earnings Remain WeakChinese ports have had a respectable stock price appreciation since releasing their financial results, outpacing both our proprietary Drewry Port Index and MSCI China Transportation and Infrastructure benchmarks. Out of the five Chinese port operators that we track, four reported in the past two weeks which saw their share prices strengthening 3.6% on average. The market valuations of Chinese operators seem stretched to us, not fully reflecting…

Chinese Port Operators - Core Earnings Remain WeakChinese ports have had a respectable stock price appreciation since releasing their financial results, outpacing both our proprietary Drewry Port Index and MSCI China Transportation and Infrastructure benchmarks. Out of the five Chinese port operators that we track, four reported in the past two weeks which saw their share prices strengthening 3.6% on average. The market valuations of Chinese operators seem stretched to us, not fully reflecting…

Chinese Port Operators - Core Earnings Remain Weak

Asia Ex-J Consumer/ Transport analyst

Valerie Law, CFA

Extending my point about more demanding transportation frameworks going forward (see <a href="https://www.smartkarma.com/insights/comfortdelgro-fy16-results-an-era-where-competition-hits-a-higher-gear" target="_blank" data-smartkarma-citation="insights:8719">ComfortDelGro FY16 Results: An Era Where Competition Hits a Higher Gear</a> ), the recent fire-bomb attack on Hong Kong’s MTR that left 19 injured signals increasing costs for transport operators. This article presents another reason why investors should sell MTR Corp, on top of points already provided by fellow insight provider Sameer Taneja in an earlier piece <a href="https://www.smartkarma.com/insights/mtr-66-hk-conviction-sell-thesis" target="_blank" data-smartkarma-citation="insights:7982">MTR (66 HK): Conviction Sell Thesis</a><h2>Security Costs to</h2>…

Extending my point about more demanding transportation frameworks going forward (see ComfortDelGro FY16 Results: An Era Where Competition Hits a Higher Gear ), the recent fire-bomb attack on Hong Kong’s MTR that left 19 injured signals increasing costs for transport operators. This article presents another reason why investors should sell MTR Corp, on top of points already provided by fellow insight provider Sameer Taneja in an earlier piece MTR (66 HK): Conviction Sell ThesisSecurity Costs to…

66 HK and SBUS SP: Attack on HK Metro Signals Increases in Transport Operators' Costs

Leading Independent Investment Research, Morningstar, Inc.

Morningstar

Leading Independent Investment Research

Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. We offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. 

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Download the Morningstar Fact Sheet : http://corporate.morningstar.com/US/documents/MarketingFactSheets/AboutMorningstarFactsheet.pdf

<a href="https://www.smartkarma.com/entities/360" target="_blank" data-smartkarma-citation="entities:360:1">COSCO Shipping Ports Ltd (1199 HK)</a> will become <a href="https://www.smartkarma.com/entities/19462" target="_blank" data-smartkarma-citation="entities:19462:1">Qingdao Port International Co Ltd (6198 HK)</a>'s second-largest shareholder following the subscription of shares amounting to a 16.8% stake. We think the acquisition will strengthen CSP’s operation in northeast Asia, given QPI’s well-located assets: a major hub in the region, which is ranked No. 4 and No. 6 in container and bulk handling volumes domestically.However, the pricey valuation reduces the attractiveness of the deal, and the consideration of CNY 5.71 per share implying 2.2 times price/book, compared with only 0.6 times for CSP’s existing assets, as well as a 40% premium to QPI’s current trading level. The deal is subject to regulatory and independent shareholders’ approvals, and we maintain both our earnings forecasts and our fair value estimate of HKD 10.00 per share pending additional details, but expect 3%-4% earnings upside upon completion of deal.Analyst: Jennifer Song

COSCO Shipping Ports Ltd (1199 HK) will become Qingdao Port International Co Ltd (6198 HK)'s second-largest shareholder following the subscription of shares amounting to a 16.8% stake. We think the acquisition will strengthen CSP’s operation in northeast Asia, given QPI’s well-located assets: a major hub in the region, which is ranked No. 4 and No. 6 in container and bulk handling volumes domestically.However, the pricey valuation reduces the attractiveness of the deal, and the consideration of CNY 5.71 per share implying 2.2 times price/book, compared with only 0.6 times for CSP’s existing assets, as well as a 40% premium to QPI’s current trading level. The deal is subject to regulatory and independent shareholders’ approvals, and we maintain both our earnings forecasts and our fair value estimate of HKD 10.00 per share pending additional details, but expect 3%-4% earnings upside upon completion of deal.Analyst: Jennifer Song

Acquisition of QPI Favors CSP's Long-Term Strategic Position, But Valuation Is Unattractive

Hong Kong

COSCO Shipping Ports Limited, through its subsidiaries, provides shipping container leasing services worldwide.  The Company also operates container terminals and provides container handling, storage, transportation and management services, as well as depot handling and stevedoring services.

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Cosco Shipping Ports (1199 HK)