DAOL Investment & Securities said on the 9th that an appropriate assessment is needed for Samsung Heavy Industries regarding the Korea-U.S. shipbuilding cooperation project MASGA (Make American Shipbuilding Great Again). It kept its investment opinion at Buy and raised its target price to 37,000 won from 30,000 won. Samsung Heavy Industries' closing price the previous day was 25,900 won.
Choi Gwang-sik, an analyst at DAOL Investment & Securities, said, "Samsung Heavy Industries does not run a special ship business, so the MASGA benefit had seemed the weakest, but with this business cooperation it has signed partnerships with a total of three U.S. shipbuilders, so we judge there is no significant difference," adding, "We are raising the appropriate PER from the previous 15 times to 20 times, the same MASGA multiple as the peer group."
Earlier, during the Korea-U.S. negotiations in Oct., Samsung Heavy Industries announced business cooperation with Vigor Marine with the launch of MASGA. It then said last week it had also signed partnerships with General Dynamics NASSCO (NASSCO) and Conrad Shipyard (Conrad).
Choi said, "With Vigor, which is strong in maintenance, repair and overhaul (MRO), the two sides agreed to start MRO projects for U.S. and Indo-Pacific naval vessels and expand later to co-building of commercial ships and logistics support ships," adding, "With NASSCO, together with Korea's DSEC, which has done multiple designs in the United States, the three parties signed a memorandum of agreement (MOA) that includes design cooperation for logistics support ships, supply of equipment such as materials and blocks, training and education of shipbuilding personnel, and a joint bid for the U.S. Navy's next-generation logistics support ship."
He added, "An order for the Delfin floating liquefied natural gas production facility (FLNG) is also imminent, and this, too, is expected to benefit from the U.S. policy encouraging liquefied natural gas (LNG) exports," noting, "Short-term momentum remains intact."