HMM Co Ltd: Better positioning on costs & tanker, but can’t avoid the container downcycle

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HMM Co Ltd: Better positioning on costs & tanker, but can’t avoid the container downcycle

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HMM Co Ltd

Better positioning on costs & tanker, but

can’t avoid the container downcycle

Initiating Coverage: NEUTRAL | PO: 21,500 KRW | Price: 18,650 KRW

Initiate at Neutral 09 June 2026

We initiate on HMM Co Ltd (“HMM”) with a Neutral rating and KRW21,500 price Equity

objective set at 0.75x PBV. HMM has some advantages over its container liner peers

given its better cost structures and more diverse shipping operations, while its strong Nathan Gee, CFA >> Research Analyst

balance sheet could support further shareholder returns ahead. But it cannot defy the Merrill Lynch (Singapore)

broader container shipping downcycle which we see worsening into 2027-28, while its +65nathan.gee@bofa.com6678 0418

ambitious 2030 growth strategy could bring utilization challenges. Amy Han >>

Research Analyst

Better positioned on costs, diversification & returns Merrill+852 3508Lynch5344(Hong Kong)

HMM has a better cost structure than its container liner peers given its fleet of younger amy.han@bofa.com

mostly owned vessels with a high scrubber installation which we see allowing it to Hiro Nakakura, CFA >>

outperform industry margins into the downcycle. ~25% of its profits are from tanker and Merrill Lynch (Singapore)

bulker shipping where long-term contracts and better industry fundamentals are hiro.nakakura@bofa.com

supportive for earnings. And HMM’s strong balance sheet (KRW8,700/share net cash)

and its 2030 5% total yield target leaves room for shareholder return upside ahead.

Stock Data

Watch risks from the container cycle & growth strategy

Container shipping has stayed profitable in 2026 on strong demand and a delayed Red Price 18,650 KRW