RINA Services: Where to invest?

RINA Services: Where to invest?

What is the most promising shipping segment to bet on? Is this the right time to invest in ships? Michele Francioni, ceo of the Italy’s RINA Services, has his fair share of views in this department. He’s optimistic about cruise, gas and roro and downcast about prospects for dry bulk and offshore.

In general, Francioni is of the opinion that shipping is set to be more stable than in recent years.

RINA Services is the Italian RINA group company which delivers ship classification, and testing, inspection and certification services.

Today’s shipping trends — according to Francioni — are based on three main factors: oversupply of ships still to be absorbed, the price of oil lowering and shipyard capacity expected to go on decreasing.

“Newbuilding prices are still going down and yards need to find new sectors to fill capacity other than dry bulk,” he says.

Talking on where smart investments should go now, Francioni seems to be tepid about dry and liquid bulk. “The bulk carriers orderbook/fleet ratio has lowered from 24% in 2013 to 17% in September 2015 with the highest decrease in the handysize segment, whereas on the liquid side the orderbook is constantly growing in the period and main demand is for the biggest size of product tankers (MR and LR). Bulk carriers prices are constantly going down while for tankers they are stable,” he says.

Francioni also thinks that with the global box fleet now in excess of 20m teu, this is also a market not to invest in at the moment.

Similarly, the Genoese naval engineer would steer clear of offshore investments.

Roros, however, look like a promising bet, he says, with a clear need for more specialised vessels.

Also the market for LNG ships, “even if the business is facing a slowdown nowadays, in the future will experience an uptrend” he says citing a growth of the orderbook from 26% to 38% in the period from 2012 to 2015 and with many orders registered last year with the low price of oil.

The brightest light at present is the cruise industry that is constantly increasing year on year, the RINA boss reckons, saying it is the only shipping sector not negatively affected by the soaring supply of ships.

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