LPG shipping (DNB Markets) - Returning to seasonal norm
We remain positive on the LPG space following a change of analyst, and reiterate our BUYs ahead of the Q2 results. In April, we stated that the companies were trading as if balance sheet restructuring was imminent, with BW LPG trading at a P/NAV of 0.32x and a price/book ratio of 0.34x. Valuations have lifted from these distressed levels, warranted we believe by less uncertainty on US LPG production and Asian demand. VLGC freight rates are now back up to USD50k/day, in line with the seasonal norm, and up from an average of USD15k/day in June.Avance Gas Holding is principally engaged in the transportation of Liquefied Petroleum Gas ("LPG"). Co. operates a fleet of 14 Very Large Gas Carriers, providing transportation services to oil majors and traders of LPG on a global basis. Co. transports LPG from the Middle East and the U.S. Gulf or U.S.loan facility from BCBloan facility from BCB(excludes dividends satisfied by issue of shares) East Coast to destinations in Europe, South America and Asia.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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