[Click eStock] "Samsung Heavy Industries Fair Value Maintained at 20,000 Won"

Meritz Securities maintained a target price of 20,000 KRW and a buy rating for Samsung Heavy Industries on the 25th.

In the third quarter, sales reached 2.322 trillion KRW, operating profit was 119.9 billion KRW, and the operating profit margin was 5.2%. The strong performance, exceeding the operating profit consensus by 12%, was due to one-off factors. The defect repair period for the offshore project ended, resulting in a reversal of defect repair provisions amounting to 51 billion KRW, and a cost of 32 billion KRW was incurred as a settlement for wage negotiations.

Under steady improvement in the merchant ship segment, growth in the offshore segment is emphasized. Smooth schedule progress toward full operation of the offshore segment was confirmed. The progress rate of Z-FLNG at the end of the third quarter was about 20%, and sales recognition for Coral Sul 2 FLNG was anticipated. For Coral Sul 2 FLNG, which signed a shipyard commencement agreement, steel cutting for the hull section has begun. If orders are confirmed in the fourth quarter, sales recognition for the costs already incurred can be immediately reflected.

Regarding some concerns about production load in the offshore segment, a different perspective was presented. The delivery schedule for container ships in 2025 and 2026 is expected to decrease by 25.0% and 45.0%, respectively, compared to 2024, which can offset the production burden. Measures to improve production efficiency through agreements with neighboring shipyards are also being considered. Even if Cedar FLNG enters full-scale processing from 2026, smooth schedule progress is expected.

This content was produced with the assistance of AI translation services.