News and Updates on HD Hyundai
HHI Eyes IPO to Raise KRW 1 tln for Green Migration
Hyundai Heavy Industries (HHI), the world's No. 1 shipbuilder, is to invest KRW 1 trillion in eco-friendly projects to prepare for the low-carbon era.
HHI announced on January 26 its five-year plan to invest up to KRW 1 trillion won in projects to develop environmentally friendly vessels and shipbuilding technologies and to construct green production facilities, in a bid to further strengthen its business competitiveness.
To finance these projects, HHI will go public this year to issue new shares amounting to a 20% stake.
Currently, HHI is wholly owned by Korea Shipbuilding & Offshore Engineering (KSOE), the intermediate holding company for HHI Group's shipbuilding operations.
The new capital will fuel the company’s plans to develop eco-friendly and smart vessels that meet the needs in the low-carbon era, such as green fueling through hydrogen and ammonia, and autonomous ships, while also advancing fuel engine-propelled ships.
In addition, HHI will make technology investments, including M&As and purchase of stakes in companies with technologies for battery cells, while also laying the foundation for ESG (Environmental, Social, and Governance) management by building eco-friendly ships and investing in facilities.
The investment decision comes at a time when the shipbuilding industry is seeing clear signs of recovery. HHI seems to believe that now is the right time for proactive investing in future markets.
Clarksons Research, a UK company that analyzes the shipbuilding and shipping market trends, says global new orders for ships are expected to rise by 21% to 23.8 million compensated gross tons (CGTs), or 974 ships, this year compared with last year, and from 2022 to 2025, the global new orders are forecast to reach 35.1 million CGTs, or 1,552 ships, on annual average.
The Shanghai Containerized Freight Index (SCFI), which shows the level of current sea-route freight rate, hit 2,885 points on the 15th, the highest since 2009 when the tally began.
"The paradigm of the global shipbuilding industry is already shifting toward technology," said an official of HHI Group. "Backed by outstanding technological capabilities, we will cement our position as the 'first mover' that leads changes in the market."