Shenwan Hongyuan Group: New ship prices continue to rise, and the performance verification cycle for shipping companies shows an upward trend.

Shenwan Hongyuan Group released a research report stating that the upward trend in new ship prices continues, with oil, bulk, and container ship prices rising in resonance. New ship prices increased in July, marking a consecutive four-month growth trend. Since the beginning of the year, the oil transportation market has maintained a high level of prosperity, with shipowners increasingly willing to place new orders for ships, thereby driving the prices of new oil tankers upward. Compared to the beginning of the year, current new oil tanker prices have risen by 4.18%, bulk carriers by 4.98%, container ships by 2.02%, gas carriers by 1.91%, and car carriers by 1.11%. Different ship types have experienced a resonance in price increases against the backdrop of shared shipyard capacity, and this trend is expected to continue. The main points from Shenwan Hongyuan Group are as follows: Order Volume In July, the order volume experienced a seasonal decline, with oil tankers and LNG vessels seeing significant year-on-year growth, while the order structure remained relatively balanced. Over the past three years, July order volumes have consistently declined month-on-month, mainly due to the concentrated confirmations at the end of the second quarter, summer vacation in Europe and the United States, and statistical lag. So far in July, 3.57 million CGT (compensatory gross tonnage) has been recorded, representing a month-on-month decrease of 56% and a year-on-year decrease of 22%; oil tankers and LNG vessels are up by 69% and 184% year-on-year, respectively. Considering subsequent adjustments by Clarkson, the final order scale is expected to be revised upward. Guangdong Songfa Ceramics 26Q2 performance exceeded expectations, with the delivery of high-value orders and improved efficiency accelerating profit release, demonstrating significant growth potential. Performance: The company expects the net profit attributable to the parent company for 26H1 to be approximately 3.6 billion yuan, a year-on-year increase of 456%; in 26Q2, the net profit attributable to the parent company is estimated at approximately 2.5 billion yuan, a month-on-month increase of 129% and a year-on-year increase of 275%, outperforming expectations. Rapid capacity ramp-up and the gradual delivery of high-price orders contributed to accelerated profit release. Volume and price optimization coincided with structural improvements in ship types. As of the end of July, the expected delivery volumes for 26-28 years have increased year-on-year by 423% / 60% / 52%; the proportion of bulk carriers delivered decreased from 64% in 26 years to 10% in 28 years, while the proportion of container ships rose from 0% to 46%, and the proportions of VLCCs and large LNG dual-fuel container ships increased. MSCs potential orders further validate high-end container ship construction capabilities. Capacity expansion supports future growth. In July, the company signed new orders totaling 490,000 CGT, primarily scheduled for delivery in 2028-2029, with further enhancements in future annual production. Under full operational efficiency of its first to third phases, the annual output value is expected to surpass 100 billion yuan; the site for the fourth phase has been approved, providing further expansion potential. China CSSC and CSSC Offshore & Marine Engineerings 26Q2 performance met expectations, with optimized order structure supporting profit elevation. China CSSC: The expected net profit attributable to the parent company for 26H1 is projected to be between 9.2 billion and 11 billion yuan, representing a year-on-year increase of 144%-191% when restated after consolidation; for 26Q2, the net profit attributable to the parent company is estimated to be between 4.37 billion and 6.17 billion yuan, a year-on-year increase of 140%-239%, with a median of 5.27 billion yuan, in line with expectations. CSSC Offshore & Marine Engineering: The expected net profit attributable to the parent company for 26H1 is projected to be between 790 million and 890 million yuan, a year-on-year increase of 50%-69%; for 26Q2, the net profit attributable to the parent company is estimated to be between 390 million and 490 million yuan, a year-on-year increase of 15%-44%, with a median of 444 million yuan, in line with expectations. Yangtze River: The gross profit margin for shipbuilding in 26H1 (37%) reached a record high, raising the ceiling for industry profit margins. Risk Warning: New orders in the civilian shipbuilding sector may fall short of expectations; a decline in shipping prosperity; significant increases in steel prices and other raw materials / substantial appreciation of the RMB; intensified competition from other countries such as those in Southeast Asia; risks of discrepancies between performance forecasts and actual results.