HK Stock Market Move | Cssc Offshore & Marine Engineering (00317) rises by over 4%, second-hand ship prices stabilize or support new ship prices. Institutions are optimistic about the company's profit entering an explosive period.

Cssc Offshore & Marine Engineering (00317) rose by over 4%, reaching a 4.23% increase at the time of writing, at HK$10.84, with a turnover of HK$1.13 billion. Guosen pointed out that the lack of supply on the industry's side and the potential rebound in demand are expected to significantly increase the return on ship assets. Due to the tight shipyard capacity currently, prices of new and second-hand ships have risen sharply. Since shipbuilding takes a longer time, second-hand ships, considered "spot", have seen greater price increases compared to new ships, considered "futures". Shenwan Hongyuan Group noted that the second-hand ship price index stabilized in mid-February and rebounded, which will further support new ship prices. UBS Securities International pointed out that Cssc Offshore & Marine Engineering is one of the leading companies in China's shipbuilding industry. Due to the cyclical nature of the shipbuilding industry, rising new ship prices, and benefiting from its technological advantages and a sufficient order backlog of RMB 60 billion, its profits are expected to enter an explosive period. The bank noted that since the fourth quarter of 2024, the stock price has seen a significant correction due to issues related to the parent company's restructuring. The bank believes that the company's fundamentals remain strong and expects that as its profitability improves, negative sentiment will gradually dissipate, and the stock price will resume its upward trend.