Analysts in the firing line for failure to spot Hanjin’s demise

Analysts in Seoul failed to see the full plight of Hanjin Shipping, and are on the receiving end of considerable criticism this week on the back of Friday’s announcement that the carrier will have to restructure.

Hanjin’s share price has been in free fall this week, its price now down by around 50% from the start of the year as it seeks creditor approval for a restructuring, owing banks around $600m.

Many analysts had continued to give the line the thumbs up as recently as this month, with many tipping Hanjin Shipping to outperform Seoul’s main bourse.

According to financial data provider Wise FN, only 0.1% or 23 reports expressed sell opinions out of the total of 28,702 reports released from March 2014 to March 2015. Reports with buy recommendations took up 86.6%, and those with strong buy, 3.6%.

With compatriot line Hyundai Merchant Marine (HMM) also seeking creditor-backed restructuring local media continues to speculate that the pair will merge, something the two lines have strenuously denied in recent months.

The government has said that Hanjin Shipping and HMM will be put under court receivership should they fail to talk foreign shipowners into cutting charter fees drastically by mid-May.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.
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