BW LPG (Buy, TP: NOK141.00) - Energy shipping at 0.7x EV/GAV
We continue to see BW LPG as the go-to stock for LPG shipping exposure given its scale, track record and discounted valuation to peers (EV/GAV 0.7x). Rates are spiking at a time when freight markets typically slump, as the US is full to the brim with potential volumes for export and demand still looks strong in Asia. As focus turns from bearish tales of substantial deliveries for 2023 to limited fleet growth potential beyond, we believe the valuation gap will close. We reiterate our BUY and have raised our target to NOK141 (120).
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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