Goldman Sachs released a research report, upgrading cosco shipping holdings (01919) investment rating from "sell" to "neutral". Due to the recent escalation of geopolitical tensions in recent years, the complexity of the shipping supply chain has increased, including some shipping routes becoming longer, which may benefit some Chinese shipping companies, including cosco shipping holdings, with high freight rates during supply chain disruptions, boosting the expected return on equity and providing support for the price-to-book ratio valuation.
The bank further stated that the management of cosco shipping holdings revealed that due to the US East Coast port strikes, the early peak season before potential tariff increases, and the earlier Chinese New Year next year, all have driven the rebound in spot freight rates. The bank raised the valuation basis for cosco shipping holdings, increasing its forecasted 2025 price-to-book multiple from 0.6 times to 0.8 times, and correspondingly raising the target price from 7.9 Hong Kong dollars to 10.7 Hong Kong dollars, maintaining its forecasts for 2024 to 2027.
