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Singamas – Container Manfacturer owned by PIL
Global investment bank Jefferies says there’s increasing demand for containers that will be of benefit to Hong Kong-listed Singamas Container Holdings, is one of the world’s leading shipping box manufacturers.
Jefferies’ analyst Leon Liao said the company’s total sales for 2014 should exceed 2.5 million TEU, up nine per cent compared to 2013.
“We expect the trend will continue as global trade volume is improving driven by a strong dollar, and pending replacement demand will accelerate benefiting from a better profitability of shippers.”
The analyst also pointed out that the company’s container sales volume last quarter exceeded expectations.
“We estimate the industry’s sales volume in 2014 is around 2.5 million TEU, up from 2.3 million in 2013. Channel checks showed that more container shipping companies started to ask the price/place orders in 2H14.
“Seventy to 80 per cent of the orders are coming from container box leasing companies in 2012/13. We believe the demand is recovering.”
Mr Liao also explained: “The sector is primarily driven by old box replacement and new container ship equipment,” adding that replacement demand has been pending for three years, according to Barron’s Asia.
“The lowered oil price will benefit container shipping liners directly which will add more flexibility of replacing old boxes. Our global strategist also believes a strong dollar should mean an improvement in global trade which will drive more new demand in container boxes.”