China Shipbuilding: Multi-year earnings visibility; initiate on Songfa and CSSC at OW; assume coverage of YZJ at N

研报英文原文证据摘录

China Shipbuilding: Multi-year earnings visibility; initiate on Songfa and CSSC at OW; assume coverage of YZJ at N

Beatrice Lam AC Asia Pacific Equity Research

(852) 2800-8738 09 July 2026 J P M O R G A N

beatrice.lam@jpmorgan.com

Executive summary

China’s shipbuilding industry is entering what we believe will be the most profitable

phase of the current cycle. We believe the market is underappreciating the structural

improvement in today’s orderbooks. Record backlog, elevated newbuilding prices,

stronger customer payment terms and disciplined capacity additions provide materially

greater earnings visibility and cash conversion than in previous cycles, supporting a

longer and more durable earnings cycle.

More importantly, we believe this cycle differs fundamentally from previous

shipbuilding booms. Demand is rotating across vessel classes rather than collapsing,

with tankers, LNG carriers and bulk carriers increasingly offsetting moderation in mega-

containership ordering. Capacity expansion remains disciplined, driven primarily by

productivity improvements and the reactivation of dormant yards rather than speculative

greenfield investment. Meanwhile, delays to the IMO Net Zero Framework appear to be

redistributing replacement demand over a longer period rather than eliminating it

altogether. As a result, we believe industry earnings are likely to prove both

stronger and more durable than current market expectations.

Understanding our coverage universe

Figure 1: Anatomy of the shipbuilding industry

Source: J.P. Morgan.

Our coverage spans three companies occupying different strategic positions within

China’s shipbuilding industry.

China CSSC Holdings (“CSSC”; 600150 CH) is the world’s largest listed shipbuilder