Barclays cautious on container shipping as oversupply bites

Zim Integrated Shipping Services

05/12/2023 09:29

** Barclays sees a "dawn of a new annus horribilis" for the
global container shipping industry, expecting the market to
enter a period of "significant" losses in 2024-2025
    ** The brokerage expects oversupply to widen further in
2024, which it says will create a challenging backdrop together
with muted demand, forecasting losses at EBITDA level
    ** "We do not expect a recovery in trade activity to be
sufficient to absorb the oversupply that the industry has found
itself in again," it says
    ** Barclays initiates Germany's Hapag-Lloyd  HLAG.DE  at
"underweight", saying its unit costs remain elevated while
freight rates continue to decline; it reiterates "underweight"
for Maersk  MAERSKb.CO  and ZIM  2SV.F 
    ** For Maersk, it cuts price target to DKK 8,250 from DKK
9,600, with a 24% downside to the share price on Dec. 1
    ** The Danish shipping giant's strategy in developing into
an integrated container logistics operator carries "significant
risks", says the brokerage
    ** Hapag-Lloyd shares are down around 3%, while Maersk slips
2.4%

 (Reporting by Greta Rosen Fondahn)
 ((Greta.RosenFondahn@thomsonreuters.com))