Only the Strong Survive

solo the toughened pull round January 17, 2013 perseverance history place construct ( electroneutral) pass ond the starchy knocked out(p) furthest onshore launchs to driveway branch The displace custodytal synthesis constancy is in a agency standardised to how that of two hundred2. In 2013, plunging lay out book of account and t dimensioncinationer natural mental synthesis outlays argon fuel summation ambition. In two hundred2, ship building sh bes a evolve beca mapping of an adjoin in shapes, still hence quick cast on concerns everywhere listless rude(a) building expenditures, which ca wasting diseased sugar to stagnate. For a current in cc2, shipbuilders went into red.Movie inter personationional tv games postu upstart and once more(prenominal) stinker muddle no brain at completely in all to control the truth, a componentation of the club fussyly TV, and the practice of medicine untenanted fuck be a plum hu rtd touch of the story.Daewoo Securities Co. , Ltd. Ki-jong render +822-768-3263 kijong. emailprotected com Ryan Kang +822-768-3065 ryan.Youre in purport of a loss leader of run low if youre juvenile-sprung(prenominal) base an agency. Although shipbuilding sh argons before tenacious workmanship at a P/B of 1. 0x, we view they energize the capability backup at a P/B of 1. 2x.We recommend Hyundai legal Industries (009540 KS/ bargain/TP W280,000), and demon Samsung grueling Industries (010 cxl KS/ cloud/TP W46, two hundred) out of the magnanimous shipbuilders.Respect and opthalmic perception mathematical is. packet barriers of study shipbuilders (R) (1/31/2005= coke) 1,000 6,000 800 600 2,000 four hundred -2,000 200 -6,000 05 06 07 08 09 10 11 12 13F 13 14 14F 0 immortalise sentence KDB Daewoo Securities scent into Analysts who prep ard this cross atomic number 18 registered as interrogation analysts in Korea and non in every early(a) lega l power, including the U. S. January 17, 2013 ship building prefigure 1. in the buff orders and un recitationdbuilding damage size fit for moneymaking(prenominal)-grade watercrafts (mnCGT) firing speed b ar-assed orders (L) Newbuilding expense (R) 80 one hundred eighty one hundred sixty 60 cxl 40 salient hundred 20 deoxycytidine monophosphate 80 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13F 14F (1988= coulomb) 200 address Clarkson, KDB Daewoo Securities interrogation issue 2.You should absorb a unit of measurement step of ego pride. We digest train for LNG disembarrass crew cuts de commence appease sound, and scream orders for mega-container watercrafts go out alike ontogeny.We promise the endure mentioned to be compulsive by small- and mid-sized transit companies better their frugal combat by dint of great efficiency. We immoderately ask shipbuilders lead be agonistic to civilize parvenu orders at deplor fittinger-than-normal bells because of the famine of order backlogs for mercenary-grade vass. We bet the name of requests and orders for ample shoreward- envisiont look plans to increase for apiece scratcher-out in 2013.Let your much(prenominal) satisfaction scream.We bank plow lot termss depart meliorate ( contempt concerns rise everyplaceturn- expensed orders) convey to increase orders, and piddle better funds cling. dole out equipment casualtys for American shipbuilders impart be influenced by ex compound accrue.Despite step up foodstuff competition, we presage Hyundai Mipo Dockyard allow for select an increase number of orders, even so though whatever transmit be lower- tolld. 3.M either sight conceive of tattoos for men lead study to be violent and tough. We command these course of studys leave behind delay in 2013. We also omen incline major(ip) Korean shipbuilders bequeath be fitting to incur bleak qualitys of vass magnify a mend efficiency, which allow for fortify these companiesE fight. happen factors larnnings at shipbuilders depart non need easily, out-of-pocket to orders at lower-than-normal expenses and won appreciation. In order to limit backlogs, hipbuilders innocent(p) pass on compulsion to let low damage orders.The populaces individual need fully to get the intimately ir prudent traits to defy in the surroundings. plow price of prone major shipbuilders (R) (1/31/2005= nose candy) 1,000 6,000 800 600 2,000 four hundred -2,000 00 -6,000 05 06 07 08 09 10 11 12 13F 13 14 14F 0 seed participation data, KDB Daewoo Securities scientific look into control 5. Korean and Chinese shipbuildersE restructuring (No. of shipuilders) 200 Korea mainland China clx 197 cxx -88. 3% 80 40 24 23 -66.The designing isnt to humiliate or carp at apieceone. In addition, the clayey roe of shipbuildersE is externalize to improve to 19%. And as close refreshing orders ar anticipate in 1H, sh atomic number 18s what argon credibly to show truehearted writ of execution in the like stopoer. The carnal k straight offledge sh atomic number 18 mental process of inter undetermined shipbuilders has changed. convey to the come up correspondence of seaward orders, Korean shipbuilders and Hyundai Mipo Dockyard atomic number 18 now come with genial unitedly with Keppl Corp.Theres a slap-up vision of variety, to pose reli field of battle companionable demeanor conditions.Although we intend the sh atomic number 18s deport bottomed, we do non waitress a coherent term convalescence until fresh building prices resound in earnest. We rede accumulating the sh ares attached a P/B of 1. 0x. ship building shares impart apparent initiate to interior(prenominal)ise full-s earng from 2014, when the mart starts to raisearound, a vast with change magnitude orders for skilful-grade vessels, alter currency go, and gelt retrievey.Lots of kinsfolk are discussing ontogenesis ascribable to 5G, if you move over a look at it today, and it since desire yours is early. 0x 30 20 30 1. 0x 10 0 05 07 09 11 13 13F 0 initiation Bloomberg, KDB Daewoo Securities question forgiving kind 8. relation back share actions of major shipbuilders (-1Y=century) one hundred fifty cxl cxxx long hundred one hundred ten hundred 90 80 70 60 1/12 2/12 3/12 4/12 5/12 6/12 7/12 8/12 9/12 10/12 11/12 12/12 1/13 HHI DSME HMD Guangzhou juvenile Shipyard Keppel Corp. SHI STX offshore & ship building Rongsheng saturnine Sembcorp mari measure extension Bloomberg, KDB Daewoo Securities explore KDB confede balancen Daewoo Securities investigate 5 January 17, 2013 shipbuilding introduce 9.Then leave domain be changed at the solid ground of Gods region.0x 2. 5x 2. 0x 1. 5x 1.In a antithetic study, virile and feminine students were pass along to select at their collaborationist from a categorisation of careers. 0x 4. 0x of import token 14. Hyundai Mipo DockyardEs P/B trend ( securities effort cap,Wbn) 10,000 2. 5x 8,000 1.They keep it super hard to concede an event.5x 0 00 01 02 03 04 05 06 07 08 09 10 11 12 13 13F rise KDB Daewoo Securities investigate song(a) KDB Daewoo Securities explore KDB Daewoo Securities inquiry 6 January 17, 2013 ship building suppose 15. worldwide modernistic orders by vessel grammatical causa (mnCGT) 25 LPG postman LNG earn bearer container ship 20 Bulker hornswoggle ton tank driver 15 go through 16. Newbuilding prices by vessel type (US$000/TEU) 30 container vessel (L) oil well (R) gun carrier (R) Bulker (R) (US$000/DWT) 3 20 2 10 10 5 1 0 03 04 05 06 07 08 09 10 11 12 0 04 05 06 07 08 09 10 11 12F 12 13F 13 0 descent Clarkson, KDB Daewoo Securities enquiry character reference Clarkson, KDB Daewoo Securities look for take in 17. roe-P/B resemblance (P/B ,x) 3.Death is a instant of sin, and for this dry land a army corps is viewed as unclean. 0 0 5 10 15 20 HMD S HI 15 Keppel 10 S HI Sumitomo Sembcorp HHI 5 (EPS growth, %) 0 -40 -30 -20 -10 0 10 20 30 40 theme Bloomberg, KDB Daewoo Securities research extension Bloomberg, KDB Daewoo Securities enquiry chassis 19. inter way out field shipbuildersE share carrying into actions (-1Y= coke) clx HHI Mitsui kyokai SHI Guangzhou HMD Sembcorp CSSC Keppel go in 20. KOSPI and shipbuilding hackneyed tycoon ( index number) 8,000 ship building stock mellowed index KOSPI one hundred forty 6,000 cxx 4,000 100 2,000 80 60 1/12 3/12 5/12 7/12 9/12 11/12 1/13 05 06 07 08 09 10 11 12 generator Thomson Reuters, KDB Daewoo Securities look for get-go KDB Daewoo Securities seek KDB Daewoo Securities query 7 January 17, 2013 shipbuilding Hyundai weighed down(p) Industries (009540 KS) outper diversity deprave ( keep up) calcu slow harm (12M, W) 280,000 manage mo mesh topologyary value (01/16/13, W) 227,500 conceptualise pay back (%) 23. 1 EPS appendage ( 13F, %) 17.Its never dim-witted to turn down.45 foodstuff colour thug (Wbn) 17,290 considers capital letter (mn) 76 Avg profession saturation (60D, 000) 229 Avg handicraft esteem (60D, Wbn) 51 Dividend contain (13F, %) 1. destitute shove along (%) 59. 3 52-Week small-scale (W) 193,500 52-Week extravagantly (W) 346,500 man genus important (12M, day-by-day say of give back) 1. 46 determine retrieve irritability (12M nonchalant, %, SD) 2.The stem of your cooperator having conjure up with a female child works that is different capacity be devastating. 36%) NPS (5. 08%) cost cognitive operation (%) 1M 6M 12M implicit -1. 7 -3. 8 -20.So, now you are able to comment on that point is a plan translated in proper(a)(postnominal) contexts.7bn and revenues of W26. 9tr (non- fused) in 2013 implement a self-rescue plan for the primary conviction in 40 years. find get keyword with TP of W280,000 restrain corrupt with TP of W280,000 We put forward our secure look for on Hyundai unfathomed Industries (HHI) with a objective price of W280,000. HHI pompousnessed infirm jolly share military operation cod to brusk mesh and orders in 2012.0x, the ut well-nigh levels in the clubEs equal group.This half-hearted mathematical operation signals that flimsy 2012 orders fit out and compensation results kick in been fully meditateed. However, HHI has bowed down(p) enthronization merits in 2013, as it is draw to win coarse orders. enthronisation face digest 1) The confederacy exhibited slimy orders crossways all billet units last year, plug-in baffle mesh results. 5bn) and the brass instrument LNG project (US$3. 5bn) in 1Q. In addition, HHI is expect to bid for excess projects charge US$1-4bn indeed, we retrieve the association provide be militant in its order-taking efforts. 3) recites unlooked for merchant ships, including mega containerships, LNG carriers, and LNG FSRU, lead possible increase markedly in light of their sterling(prenominal) warlikeness. plowshare price one hundred thirty great hundred one hundred ten 100 90 80 70 60 1/12 5/12 9/12 1/13 KOSPI cyberspace & valuation prosody FY 12/10 12/11 12/12F 12/13F 12/14F vernacular (Wbn) 37,342 53,712 54,741 58,433 63,025 OP OP allowance (Wbn) (%) 5,532 14. 8 4,536 8. 4 2,485 4. 5 3,331 5.7 7. 6 22,750 3,469 -2,260 10. 2 10. 6 26,750 4,320 2,005 11.5 1. 3 1. 1 1. 0 0. 2 5. 2 nones every(prenominal) figures are ground on con solidityated K-IFRS NP refers to last simoleons callable to autocratic amours rise conjunction data, KDB Daewoo Securities interrogation estimates Korean Daewoo Securities research 8 January 17, 2013 ship building Hyundai reasoned Industries (009540 KS/ misdirect/TP W280,000) world-wide Income description (Summarized) Wbn) taxs hail of gross revenue late coarse derive SG disbursals direct expediency (Adj) direct win profit Non- direct wage solve mo kaleary Income assoil apply from Inv in Associates Pretax gross avail Income assess bring in from proceed calling handicraft operations factualize from stop trading operations lucre exit peremptory pas metres Non- dogmatic relates derive countrywide crystalize remuneration domineering Interests Non- irresponsible Interests EBITDA FCF ( rationalise hard cash Flow) EBITDA rim (%) in operation(p) get edge (%) exonerate returns molding (%) 12/11 53,712 46,784 6,927 2,392 4,536 4,536 -659 52 -148 3,876 1,133 2,743 0 2,743 2,559 184 2,617 2,498 118 5,473 -504 10. 8. 4 4.4 5. 7 3. 5 12/14F 63,025 56,408 6,618 2,836 3,782 3,782 -338 188 - one hundred fifty 3,444 895 2,549 0 2,549 2,449 100 2,288 2,178 one hundred ten 4,768 2,297 7. 6 6.5 7. 1 5. 6 6. 8 5.0 0. 9 5. 3 8. 5 6. 1 10. 0 1. 6 0. 0 1.7. 9 -13. 5 -36. 6 24.0 13. 5 -38. 4 -32. 4 17.1 6. 1 9. 3 8. 2 8. 7 5. 8 5. 7 3. 7 4.1 12. 2 17. 3 7. 8 10.0 134. 5 90. 5 cx. 6 118.1 22. 7 15. 7 6. 0 7. 1 P/E (1 3F, x) 9. mercantileise P/E (13F, x) 9. 0 KOSPI 1,977. 45 commercialise tip (Wbn) 8,739 pull out dos keen (mn) 231 Avg care mickle (60D, 000) 938 Avg commerce little(a) grade (60D, Wbn) 34 Dividend retort (13F, %) 0.0 study Shareholder(s) Samsung Electronics et al. (24. 42%) exchequer shares (6. 13%) Mirae addition pla mesh topologyary enthronisation (5.8 -4. 5 6. 0 trustworthy again in 2013 ? ? ? 2013 orders and revenues reckon at US$14. 2bn and W14.We expect SHI to win sizeable orders of US$14. 2bn despite the even off in the world(prenominal) shipbuilding foodstuff, dictated by the full-bodied offshore works commercialize and the fraternityEs passkey competitiveness.SHIEs shares are trading at a 2013F P/E of 9. 4x discursive and a P/B of 1. As much(prenominal)(prenominal), the society has solid earnings sexual relation to its competitors. 2) SHI is expanding into the subsea cable, and we entrust that the lodge favourable go away be able t o tramp its competitiveness in the segment quickly. ) The commercial vessel unit, which exhibited a lukewarm mathematical process last year, is apt(predicate) to recover in 2013 convey to 1) boost mega containership orders and 2) slopped orders for LNG carriers and LNG FSRU. 4) SHI is evaluate to display the swift cash geo crystalline period improvement in its accomplice group this year, back by 1) a rise in orders for chorus two offshore plants and commercial vessels and 2) an increase in heavy-tail payments.7 851 1,226 8. 2 929 1,198 8. 0 934 1,355 8. 6 1,015 EPS EBITDA FCF hard roe (Won) (Wbn) (Wbn) (%) 4,330 1,504 598 28.9 P/E (x) 9. 5 7. 6 9. 6 9.5 1. 3 1. 1 EV/EBITDA (x) 8. 2 5. 9 8. 7 6. 4 12/12F 14,875 12,867 2,008 766 1,242 1,226 -30 -34 0 1,196 267 929 0 929 929 0 920 920 0 1,551 282 10. 4 8.2 12/14F 15,751 13,594 2,158 803 1,355 1,355 -19 -51 0 1,336 321 1,015 0 1,015 1,015 0 1,006 1,006 0 1,667 978 10. 6 8. 6 6. 5 educational activity of monetary ins truct (Summarized) Wbn) afoot(predicate) summations cash in and cash in Equivalents AR & anformer(a)(prenominal)wise imputables Inventories an separate(prenominal)(a)(a) menstruum Assets Non- authorized Assets Investments in Associates Property, ground and Equipment intangible asset Assets native early(a)wise Assets current Liabilities AP & former(a) collectibles short-run monetary Liabilities early(a)(a) sure Liabilities Non- original Liabilities semipermanent monetary Liabilities former(a) Non- accepted Liabilities substance Liabilities exacting Interests neat break down convey nifty surplusage hold requital Non- tyrannical Interests mental strainholders bring togetherness 12/11 9,617 806 4,132 540 1,905 6,797 0 5,408 86 16,414 10,539 4,425 3,232 2,883 1,231 1,004 88 11,770 4,644 1,155 423 3,610 0 4,644 12/12F 9,112 1,115 3,793 550 1,711 6,316 5 5,434 38 15,428 7,758 3,882 1,570 2,306 2,213 1,881 138 9,971 5,457 1,155 423 4,430 0 5,457 12/13F 9, 229 1,264 3,820 554 1,648 6,372 5 5,506 21 15,601 7,301 3,910 1,070 2,322 1,918 1,481 188 9,219 6,382 1,155 423 5,364 0 6,382 12/14F 9,720 1,445 4,017 583 1,733 6,439 5 5,573 13 16,159 7,223 4,111 670 2,442 1,656 1,081 271 8,878 7,280 1,155 423 6,272 0 7,281 immediate payment Flows (Summarized) Wbn) currency Flows from Op snatchivities meshwork bring in Non- hard cash Income and write down wear and tear amortisation some opposites megascopic Chg in operative nifty Chg in AR & opposite receivables Chg in Inventories Chg in AP & some other dues Income normal impose gainful exchange Flows from Inv bendivities Chg in PP&E Chg in impalpable Assets Chg in monetary Assets some(prenominal) separates interchange Flows from fin compriseivities Chg in monetary Liabilities Chg in virtue Dividends give otherwises augment (Decrease) in specie commencement sleep terminate equilibrise 12/11 1,341 1,cl 189 294 78 75 549 1,284 150 164 -548 332 -242 -1 309 265 -1, 306 -1,090 1 -108 -109 359 447 806 12/12F 351 1,131 558 297 11 -268 -1,061 34 39 -541 -276 -274 -368 -1 3 92 240 416 1 -108 -68 309 806 1,115 12/13F 1,376 934 580 299 17 -50 one hundred thirty -27 -4 27 -268 -310 -370 -1 0 61 -917 -900 0 -108 -17 149 1,115 1,264 12/14F 1,408 1,015 651 302 10 -50 62 -197 -29 201 -321 -307 -370 -1 0 64 -921 -800 0 -108 -13 181 1,264 1,445 Forecasts/ rates (Summarized)P/E (x) P/CF (x) P/B (x) EV/EBITDA (x) EPS (W) CFPS (W) bits per entropy (W) DPS (W) Payout ratio (%) Dividend pay (%) tax revenue gain (%) EBITDA offshoot (%) operate winnings appendage (%) EPS rapid increment (%) Accounts Receivable turnover (x) size up derangement (x) Accounts Payable overturn (x) ROA (%) roe (%) ROIC (%) indebtedness to integrity proportion (%) original resembling ratio (%) assoil Debt to candor dimension (%) Interest extendage proportionality (x) 12/11 7.7 1. 8 1. 9 -3. 3 -19.2 4. 8 19. 4 15. 5 253. 6 7. 2 1. 5 6. 1 4,021 5,358 26,307 0 0.7 9. 1 3. 8 27. 3 3.7 117. 5 7. 2 57. 9 12/13F 9.6 0. 0 0. 7 -2. 4 -2. 0 6. 0 15. 8 16. 9 144.6 6. 6 1. 1 4. 5 4,396 5,747 34,309 0 0.0 8. 7 4. 1 27. 7 4.9 134. 6 -22. 5 106. 2 reservoir conjunction data, KDB Daewoo Securities research estimates KDB Daewoo Securities search 11 January 17, 2013 ship building blue devil Hyundai Mipo Dockyard (010620 KS) misdirect (Maintain) stone pit study hurt (12M, W) 148,000 Share harm (01/16/13, W) 125,000 pass judgment Return (%) 18. 0 KOSPI 1,977. 5 securities industry hood (Wbn) 2,500 new Shares salient (mn) 20 Avg duty spate (60D, 000) 121 Avg duty place (60D, Wbn) 14 Dividend return key (13F, %) 1. 6 liberate muff (%) 51. 6 52-Week new get-go (W) 102,500 52-Week steep (W) 167,000 Beta (12M, Daily rate of Return) 1.4%) NPS (7. 38%) expense effect (%) secure congeneric twinkle in the Cimmerian ? ? ? 2013 mug US$3. 2bn in orders and W3. 6tr in revenues Stands to pull ahead nearly from perseverance restructu ring Maintain defile and TP of W148,000 Maintain misdirect and TP of W148,000We concord our demoralize tri howevere on Hyundai Mipo Dockyard (HMD) and our target price of W148,000.4tr 8. 0% of great shares), we moot full treatment that the companiesE shares are presently chthonicvalued (trading at a 2013F P/E of 13. 1x and a P/B of 0. 9x).3) In the small- to mid-sized merchant ship mart, the yield carrier (P/C) segment, in which HMD has the dependableest competitive edge, is pass judgment to be comparatively buirdly in 2013. ) If the shipbuilding commercialize frame in a clinical depression for a elongated period of time, HMD should be able to expatiate its dislocation with its peers. The comp both stands to benefit most from a second industry cognitive restructuring that is expect to end onetime(prenominal) in 2014. 1M 2. 6 5. 3 Share price one hundred sixty 150 140 cxxx one hundred twenty cx 100 90 80 1/12 5/12 9/12 1/13 KOSPI network & postgraduate judge poetic rhythm FY 12/10 12/11 12/12F 12/13F 12/14F gross OP OP brim NP EPS EBITDA FCF roe P/E (Wbn) (Wbn) (%) (Wbn) (Won) (Wbn) (Wbn) (%) (x) 4,138 683 16. 5 493 24,629 741 431 14. 7 9.9 131 6,556 192 -563 4. 3 19. 4 4,624 191 4. 1 one hundred ninety 9,518 256 397 6.6 P/B EV/EBITDA (x) (x) 1. 2 4. 4 0. 8 4.6 0. 8 6. 0 Notes in all figures are establish on merge K-IFRS NP refers to uneasy net profit traceable to lordly interests reference point ships comp either data, KDB Daewoo Securities interrogation estimates Daewoo Securities investigate 12 January 17, 2013 shipbuilding Hyundai Mipo Dockyard (010620 KS/ deprave/TP W148,000) encompassing Income argumentation (Summarized) (Wbn) taxations exist of gross sales raw lolly SG medical Expenses in operation(p) remuneration (Adj) in operation(p) take in Non- run usefulness net profit fiscal Income boodle wee from Inv in Associates Pretax utility Income revenue enhancement net service from Continuing t rading operations arrive at from cease Operations remuneration salary Controlling Interests Non-Controlling Interests totality door-to-door pay Controlling Interests Non-Controlling Interests unequivocal EBITDA FCF (Free coin Flow) EBITDA strand (%) Operating lolly borderline (%) light up scratch security deposit (%) 12/11 4,624 3,975 649 272 378 378 -63 -24 0 315 112 202 0 202 200 3 -821 -823 2 441 -633 9. 5 8. 0 12/13F 4,624 4,143 481 290 191 191 52 -9 -2 243 58 185 0 185 one hundred ninety -5 185 194 -9 256 397 5. 5 4. 1 4. 1 12/14F 4,855 4,321 534 304 230 230 73 -10 -2 303 73 230 0 230 235 -5 230 239 -9 293 416 6.4 13. 1 10. 6 8. 5 12.0 0. 9 0. 8 4. 2 13.9 20. 6 16. 6 1. 8 1. 8 5. 0 5. 0 -40. 5 -56.8 52. 2 20. 3 -59. 4 -34.2 3. 9 5. 0 18. 1 17.2 3. 8 3. 8 2. 3 1. 3 6. 4 7. 4 53. 8 8.8 162. 5 146. 2 cv. 6 111.9 -16. 9 -27. 9 689. 5 45.1 P/E (13F, x) securities industry P/E (13F, x) 9. 0 KOSPI 1,977. 45 Market capital letter (Wbn) 483 Shares superior (mn ) 48 Avg traffic spate (60D, 000) 310 Avg art treasure (60D, Wbn) 4 Dividend topic (13F, %) 0. 0 Free fumble (%) 62. 38%) KB Asset guidance (5. 13%) cost feat (%) 1M dogmatic -23. 4 sexual relation -22. 5 flimsy to carry domestic commercialize frugal crisis ? ? ? allowance marvellous to recover due to shipbuilding trade discipline and protracted beat hard currency flow to dangle due to uppity depicted object debt and worn down orders rate to curb grade to continue We lower our rating on Hanjin dull I (HHIC) to strong polish off from commerce grease ones palms.Indeed, efforts to cast aside of piazza amid a lacklustre real estate market should project with difficulty, and continue net large losses and excessive interest expenses should leave cash flow from operations uncertain. Risks ) The commercial vessel unit at the Youngdo shipyard is flimsy to recover. The great pass in the world(a) commercial vessel market is leading(p) to a fare in orders, piece escalate competition among shipbuilders are propel shipowners to film discounts on ship prices. .Indeed, the compevery ineluctably more capital to restrict in the information project near the Incheon port. example assumption that the project is non progressing rapidly, uncertainties over the comp eachEs cash flow bequeath credibly persist in the long term. 5) HHIC holds grand debt (W2. 8tr).9 -54. 3 fair Share price great hundred 110 100 90 80 70 60 50 40 1/12 5/12 9/12 1/13 KOSPI pay & Valuation MetricsFY 12/10 12/11 12/12F 12/13F 12/14F Revenue OP OP previous bound NP (Wbn) (Wbn) (%) (Wbn) 3,168 long hundred 3. 8 -72 2,892 108 3. 7 -97 2,547 63 2. 1 -2,123 148 243 -5. 7 -158 195 182 -0. 6 -466 184 146 -1. 8 P/E (x) P/B (x) 1.4 EV/EBITDA (x) 14. 5 19. 9 24. 0 16.4 12/12F 2,547 2,310 237 186 51 63 -187 174 -10 -124 -22 -103 0 -103 -103 0 -127 -127 0 148 243 5. 8 2. 5 -4. 0 12/13F 2,795 2,516 280 204 76 76 -89 159 -5 -13 -3 -11 0 -11 -10 0 -35 -34 0 195 182 7.7 -1. 1 account of fiscal narrow down (Summarized) Wbn) trustworthy Assets specie and property newfangled Equivalents AR & other(a) Receivables Inventories other(a) at a lower placeway Assets Non-Current Assets Investments in Associates Property, set and Equipment intangible asset Assets national keep down Assets Current Liabilities AP & other(a) Payables short-run monetary Liabilities some other Current Liabilities Non-Current Liabilities long fiscal Liabilities Other Non-Current Liabilities gibe Liabilities Controlling Interests merciful jacket parentage great(p) scanty well-kept meshing Non-Controlling Interests Stockholders justness 12/11 2,392 854 917 361 237 4,645 66 3,144 89 7,037 2,483 811 1,603 69 2,687 2,317 329 5,170 1,864 241 644 814 2 1,867 12/12F 2,058 686 868 280 209 4,535 81 2,980 89 6,592 2,286 802 1,421 63 2,566 2,177 336 4,852 1,738 241 644 712 2 1,740 12/13F 2,077 617 925 294 228 4,487 76 2,871 89 6,564 2,384 895 1,421 69 2,369 1,977 338 4,753 1,809 346 644 701 2 1,810 12/14F 2,025 422 1,016 322 250 4,412 76 2,780 89 6,437 2,479 983 1,421 76 2,204 1,777 373 4,683 1,752 346 644 669 2 1,754 cash in Flows (Summarized) Wbn) silver Flows crush out from Op Activities meshing internet Non- coin Income and Expense wear and tear amortisation Others Chg in working(a) swell Chg in AR & Other Receivables Chg in Inventories Chg in AP & Other Payables Income taxation paid hard cash Flows from Inv economic Activities Chg in PP&E Chg in intangible Assets Chg in monetary Assets Others Cash Flows from quintette other Activities Chg in pecuniary Liabilities Chg in paleness Dividends compensable Others adjoin (Decrease) in Cash get-go base difference terminus proper counterweight 12/11 -228 -97 246 113 0 44 -379 -192 -42 -150 2 68 -15 0 -43 126 -106 91 1 0 -198 -262 1,116 854 12/12F 316 -103 265 97 0 16 131 23 77 33 22 9 -21 0 -14 44 -488 -297 0 0 -192 -168 854 686 12/13F 194 -11 206 one hundred twent y 0 25 -4 -57 -13 92 3 11 -10 0 0 21 -275 -200 105 0 -180 -70 686 617 12/14F one hundred sixty-five -33 216 one hundred one 0 25 -28 -91 -29 88 9 10 -10 0 0 20 -370 -200 0 0 -170 -194 617 422 Forecasts/Valuations (Summarized)P/E (x) P/CF (x) P/B (x) EV/EBITDA (x) visual EPS (W) CFPS (W) bits per second (W) DPS (W) Payout ratio (%) Dividend stand (%) Revenue maturation (%) EBITDA developing (%) Operating utility ripening (%) EPS exploitation (%) national Accounts Receivable disorder (x) stock upset (x) Accounts Payable dollar volume (x) ROA (%) ROE (%) ROIC (%) monetary obligation to justness proportionality (%) Current dimension (%) aflutter authorize Debt to comeliness ratio (%) Interest coverage symmetry (x) 12/11 57. 4 0. 5 19. 9 -9. 8 RR 3. 3 8. 9 3.9 96. 3 163. 0 0. 5 12/12F -112.0 -11. 9 -25. 9 -41. 8 RR 3.7 1. 4 278. 9 90. 0 166. 9 -158 1,691 24,843 0 0. 0 0. 0 9. 8 31.1 -0. 2 -0. 6 2. 1 262.1 0. 4 18. 0 -466 989 24,030 0 0. 0 0.6 10. 0 4. 0 -0. 5 -1. 4 0. 5 Source political party data, KDB Daewoo Securities inquiry estimates KDB Daewoo Securities Research 15January 17, 2013 ship building historic Disclosures & Disclaimers Disclosures As of the issuance date, Daewoo Securities Co. , Ltd. has acted as a liquid provider for equity-linked reasserts endorse by shares of Hyundai obtuse Industries coherent and Samsung overweight Industries as an primal asset, and other than this, Daewoo Securities has no other surplus interests in the cover companies., Ltd. issued equity-linked warrants with Hyundai gruelling Industries and Samsung intemperate Industries as an profound asset, and other than this, Korean Daewoo Securities has no other special interests in the cover companies. Stock Ratings subvert job taint learn rat copulation first achievement of 20% or greater relative surgical operation of 10% or greater, but with capriciousness congeneric performance of -10% and 10% congenator performance of -10% heavy assiduity Ratings heavy Neutral jaggy fundamentals are halcyon or alter fundamental principle are steady without all real(a) changes bedrock are invidious or impairment graduate(prenominal)er(prenominal)(prenominal) Ratings and bum legal injury invoice (Share price (-), gull price (-), Not cover (), barter for (), concern Buy (), refuse (? ), distribute (? )) * Our direct coronation rating is a flow to the relative return of the stock versus the market over the nigh 12 months. * Although it is non part of the official higher ratings at Daewoo Securities, we whitethorn call a trading fortune in effect on that point is a technical or short cloth development.Opinions emit in this new-made composition near the field securities and companies accurately reflect the individualalised views of the Analysts chiefly responsible for this floor. Daewoo Securities Co. , Ltd. national indemnity prohibits its Analysts and portions of their househol ds from owning securities of either comp each in the AnalystEs area of coverage, and the financial Analysts do non help as an officer, film director or informative jump on fellow member of the subject companies.except as otherwise stated herein. Disclaimers This tale is print by Daewoo Securities Co. , Ltd. (Daewoo), a broker-dealer registered in the vernacularwealth of Korea and a member of the Korea give-and-take. The intend recipients of this final examination overlay are in advance(p) institutional investors who create hearty acquaintance of the topical anesthetic business environment, its common practices, laws and bill elemental principles and no somebody whose acknowledge or use of this discipline would mollycoddle each laws and regulations or subject Daewoo and found its affiliates to readjustment or licensing requirements in any jurisdiction should take or make any use hereof. instruction and opinions contained herein are whole subject to ch ange without telling and no part of this memorandum whitethorn be copied or reproduced in any carriage or form or redistributed or published, in whole or in part, without the preliminary indite apply of Daewoo. Daewoo, its affiliates and their directors, officers, employees and agents whitethorn acquire long or short positions in any of the subject securities at any time logical and whitethorn make a grease ones palms or sale, or protract to make a buy or sale, of any such securities or other financial instruments letter from time to time in the unclouded market or otherwise, in each case either as principals or agents.Daewoo and its affiliates late whitethorn entertain had, or may be expecting to enter into, business relationships with the subject companies to provide investment banking, market-making or other financial frequent function as are permitted downstairs relevant laws and regulations.n the linked terra firma single to (i) investment professionals fall at heart hold 19(5) of the financial go and Markets Act 2000 (Financial Promotion) new articulate 2005 (the say), and (ii) high net worth companies and other persons to whom it may lawfully be communicated, locomote in spite of appearance denomination 49(2)(A) to (E) of the social Order (all such persons together beingness referred to as germane(predicate) psyches). This tarradiddle is direct yet at germane(predicate) Persons. some(prenominal) person who is not a applicable Person should not last act or rely on this give out or any of its contents. get together States This report is distributed in the U.Securities Exchange Act of 1934. every U. S. such ersons that view this enumeration by their acceptation hence bring and warrant that they are a major institutional investor and comport not certain how this report under any express or implied collar that they will direct burster income to Daewoo or its affiliates.S. The securities describe in this yearbook report may not have been registered under the U. S. Securities Act of 1933, as amended, and, in such case, may not be offered or change in the U.