Will shipping and shipbuilding stocks cruise in 2011?

This year is unlikely to bring many positive surprises for Indian shipbuilding and shipping companies. To start with, global oversupply of vessels has made order inflows difficult to come by for Indian shipbuilders.
Though some analysts have maintained after the September 2010 quarter results season that there has been an improvement in global shipbuilding order inflows, the environment still remains difficult for Indian shipbuilding companies.
Nonetheless ABG Shipyard Ltd has done well on the bourses since the beginning of the fiscal compared with peer Bharati Shipyard Ltd. One of the reasons for the better performance, according to Param Desai of Angel Broking Ltd, is that ABG Shipyard has a stronger revenue visibility of about five times FY11 revenue thanks to its higher unexecuted order book of around Rs10,500 crore at the end of the September quarter. ABG Shipyard also won an order of Rs2,000 crore in November.
[Read More]
Source: Live Mint