Hafnia (Buy, TP: NOK74.00) - NAV on the rise
We expect a Q4 DPS of USD0.31 (run-rate yield of c23%), reflecting a payout ratio uplift to 60%, as asset values are rising (our current NAV is up c17% since December) on tight supply/demand fundamentals and Hafnia deleveraging. We believe investor focus is on the EU embargo on Russian oil products due to come into effect on 5 February, and how Europe (20% of global tonne-mile demand historically) aims to replace 1mbpd of imports. We see Hafnia as attractively placed in the tanker space with discounted assets (P/NAV of 0.81x) and a low cost base. We reiterate our BUY and have raised our target price to NOK74 (70).
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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