Record-High Performance Explodes... The Real Reason Shipbuilding Stocks Can't Go Up "The Heaviest Stock Rises the Highest" / Floating Data Center... Can We Expect Samsung Heavy Industries? | Eom Gyeong-a, Research Fellow

Summary

Shipbuilding analyst Eom Gyeong-a argues Korean shipbuilding stocks have strong long-term upside due to margin expansion, FLNG orders, regulatory replacement demand, and AI catalysts. She recommends the sector as a whole and specifically favors HD Hyundai Heavy Industries as the best beneficiary. The interview covers recent underperformance, geopolitical impacts, and emerging themes like floating data centers.

• Korean shipbuilding stocks have underperformed recently despite strong fundamentals due to profit-taking and rotation into semiconductors.
• FLNG and offshore orders are increasing and will significantly boost profitability for Samsung Heavy Industries and peers.
• The Hormuz Strait blockade has actually increased shipping complexity and vessel ordering, benefiting shipbuilders.
• Operating margins for Korean shipbuilders are expected to reach 20% as vessel prices remain elevated while steel costs stay stable.
• The largest shipbuilder, HD Hyundai Heavy Industries, is expected to rise the most within the sector.
• Environmental regulations are driving a multi-year replacement cycle for aging vessels independent of shipping rates.
• AI data center demand is creating new demand for shipbuilder-made engines and floating data center solutions.
• Floating data centers are a real opportunity but will take 3-4 years to materialize.