Wan Hai Lines (2615 TT):  Increased Scrapping May Dent Earnings

Yang Ming Marine(2609 TT): Already Reeling Financials to Suffer Significant Cost Burden

CMA CGM: Credit Metrics Improved on the Back of Rising Profitability; Strong Liquidity

Container Shipping 2018 - Trade War and Higher Costs Dim Hope of Recovery; Revise Sectoral Calls

AP Moller Maersk: Restructuring yet to Bear Substantial Benefits

Hapag Lloyd (HLAG GR): Riding High on Improving Fundamentals

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

AP Moeller - Maersk A/S / Equity Bottom-Up

<p>Although APMM is turning incrementally more positive in 2019 driven by higher freight rates (Drewry est. 6.5%) versus 2018 (2.6%), we believe its share price may be underpinned by the unknowns, including the trade war effect, substantial CapEx/opex cost escalation owing to the IMO regulation and pursuit of supply chain integration strategies. At 0.9x 2019e PB and fair value of DKK 9,500, we believe Maersk is decently priced at the moment and therefore maintain our position until there is more clarity, especially on the trade war.</p>

Although APMM is turning incrementally more positive in 2019 driven by higher freight rates (Drewry est. 6.5%) versus 2018 (2.6%), we believe its share price may be underpinned by the unknowns, including the trade war effect, substantial CapEx/opex cost escalation owing to the IMO regulation and pursuit of supply chain integration strategies. At 0.9x 2019e PB and fair value of DKK 9,500, we believe Maersk is decently priced at the moment and therefore maintain our position until there is more clarity, especially on the trade war.

AP Moller Maersk (MaerskB DC) -Expect 2019 to Be Better