Cosco: Cosco (Guangdong) Shipyard, a subsidiary of 51% owned Cosco Shipyard Group, has secured an order to build 1 unit of Special Purpose Carrier. , through the exercise of an option by an European shipowner. In Feb ’11, the customer contracted for 3 firm plus 1 optional contract valued at over US$113m for Special Purpose Carriers.
The latest vessel is scheduled for delivery in 4Q13.
While the contract win is welcome, we note that Cosco’s order momentum has slowed substantially. Until order flows pick up, it might be too early to turn positive on the stock.
Recall last week, BNP reiterated its Reduce rating and lowered TP to $0.80 from $1.30, on supply glut (worsened by weak economy outlook), increasing competition and potential order cancellation.
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