风险提示。红海绕行结束；行业价格战风险；公司分红不及预期；汇率波动风险；地缘政治风险Global shipping leader, full-chain logistics model development, stable dividend payment policy. Since its establishment in 2005, the company has gone through two mergers and acquisitions between CNOOC Group and Dongfang Overseas, forming a business model that mainly focuses on container business and extends port logistics vertically. Currently, the company's shipping business is leading the world, and its capacity share is stable at the top of the world, and its profitability exceeds that of Maersk, a leading overseas company. 2022-2024H1, the company continued to pay 50% dividends and distributed a cumulative dividend of nearly 90 billion yuan. Net cash flow from the company's operating activities rose simultaneously, laying a solid foundation for the company to continue to pay cash dividends to investors, as well as digital intelligence and green and low-carbon transformation to enhance core competitiveness.
Demand for continuous detours in the Red Sea continues to recover, and shipping companies' freight rate discipline supports profit margins. It is expected that the company's profit in 2025 may still be considerable. The Red Sea bypass incident led to significant changes in the supply and demand structure of the shipping market, driving freight rates to rise sharply. Continued tension in the Middle East makes it difficult to end the Red Sea detour situation in the short term. Despite significant new ship deliveries in 2024-2025, the slowdown in new ship deliveries and the impressive growth in demand are expected to support freight rates. The trend of large-scale ships and alliances in the shipping industry continues to develop, and industry concentration continues to increase, making shipping companies have stronger bargaining power in the market. Furthermore, the impact of increased environmental regulations on shipping costs and the fragility of supply chains disrupting freight rates will still be important factors affecting the fundamentals of shipping. As a result, despite facing the challenge of delivering a large number of new ships, against the backdrop of Red Sea detours, recovery in demand, and increased industry concentration, freight rates in the shipping market are expected to remain above the level of 2023, and the company's profit is expected to remain impressive in 2025.
Profit forecast and rating: As a container shipping leader, COSCO Maritime Control has excellent management capabilities. In the context of continued Red Sea detour, we expect the company to achieve net profit of 49.082, 26.672, and 21.536 billion yuan respectively in 2024-2026, with year-on-year growth rates of 105.71%, -45.66%, and -19.26%, respectively. The PE corresponding to the current stock price is 4.61/8.49/10.52 times; first coverage, given the continued Red Sea detour, the company, as a shipping leader, is at the bottom of the grinding cycle The period can still maintain considerable profits, and the unstable geographical situation may provide additional flexibility and give an “increase in wealth” rating.
Risk warning. End of Red Sea bypass; risk of industry price war; corporate dividends falling short of expectations; risk of exchange rate fluctuations; geopolitical risk
Today, after hitting the high near 24,000 in the early session and entering bearish positions, the index fell sharply by nearly over 600 points, immediately recouping yesterday's losses significantly.
Moreover, today it broke the new high again, reaching a maximum of 24,076, but by the end of the market, it fell back by about 70 points, producing a bearish candle. The current trend has not yet been broken, but from the previous low until now, it has risen close to 6,000 points. It is believed that those with positions can continue to hold until there is a clear trend reversal for profit-taking. Those without positions can wait for a pullback to get in. Actually, it is hoped for a quick pullback, as it allows for entry and also provides a healthy breath.
Currently, the outlook remains the same as before. It is believed that even if there is a pullback, it shouldn't be too deep. However, if Futures fail to stabilize and close below 22,350, there may still be room for decline. The chance of Futures falling below 21,400 in the short term should be low, so it is considered that if a significant pullback occurs, it presents a good opportunity to incrementally go long. Recently, there has been a consistent approach to not hold positions overnight, only focusing on immediate trades, as there is no high chasing and no casual short selling.
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