Samsung Heavy Industries received a maintained 'buy' rating and 40,000 won target price from SK Securities on May 13, as the brokerage forecast the shipbuilder's Q2 2025 operating profit at 341.3 billion won, below the market consensus of 390.2 billion won. The underperformance stems from quarterly performance bonus allocation and margin dilution from global operation subcontracting, despite revenue growth of 19.9% year-on-year to 3.2172 trillion won. The company's Floating Data Center (FDC) business is emerging as a new growth driver, with recent approvals from the American Bureau of Shipping (ABS) and Lloyd's Register (LR) for a 50-megawatt FDC concept design, positioning Samsung Heavy Industries for a potential corporate value rerating as the FDC market materializes.
SK Securities Forecasts Samsung Heavy Industries Q2 2025 Operating Profit Below Consensus
SK Securities projected Samsung Heavy Industries' Q2 2025 consolidated revenue at 3.2172 trillion won and operating profit at 341.3 billion won on May 13. Revenue represents a 19.9% increase year-on-year, while operating profit rises 66.6% compared to the same period in 2024. The operating profit figure falls short of the market consensus of 390.2 billion won. Han Seung-han, researcher at SK Securities, attributed the margin pressure to the resumption of Dock 2 launching operations and the simultaneous effect of global operations, which expanded the top line but diluted the company-wide operating profit margin (OPM) due to the relatively lower margin rates of global operation subcontracting. The analyst also cited the quarterly allocation of performance bonuses as a contributing factor to the profit shortfall.
The brokerage assessed Samsung Heavy Industries' 2025 order target of $13.9 billion and revenue target of 12.8 trillion won as achievable. The commercial vessel segment's annual revenue share by order year is expanding from 17% in 2022 to 52% in 2024-2025, which is expected to generate profit improvement effects. Samsung Heavy Industries recently signed a Memorandum of Understanding (MOU) with PetroVietnam for cooperation in shipbuilding and energy sectors, a development cited as a positive factor for future construction volume expansion.
Samsung Heavy Industries Obtains ABS and LR Approvals for 50MW FDC Concept Design
Samsung Heavy Industries obtained concept design approval from the American Bureau of Shipping (ABS) and Lloyd's Register (LR) for a 50-megawatt Floating Data Center (FDC). The company designated the FDC business as a mid- to long-term core growth driver. Samsung Heavy Industries plans to construct the first commercial FDC at Dock 2, which offers the highest efficiency for such projects.
Samsung Heavy Industries Signs MOU with ABB and Moosterian for FDC Development
Samsung Heavy Industries signed a cooperation agreement with ABB for power system development and a Memorandum of Understanding with Moosterian (M3), a U.S. data center developer, for FDC development in the United States. The company set Q2 2028 as the target service launch date for the first commercial FDC. Han Seung-han noted that to meet this timeline, Samsung Heavy Industries is likely to conclude an order contract in the near term.
SK Securities Maintains Buy Rating on Samsung Heavy Industries FDC Growth Potential
SK Securities maintained its 'buy' investment opinion and 40,000 won target price on Samsung Heavy Industries on May 13. Han Seung-han stated that the full-scale entry into the global FDC market will enable a multiple rerating for Samsung Heavy Industries. The analyst emphasized that the current valuation burden is not significant, presenting a preemptive buying opportunity. Han characterized the Q2 earnings slowdown as temporary.
FAQ
Why did SK Securities forecast Samsung Heavy Industries' Q2 2025 operating profit below market consensus?
SK Securities attributed the below-consensus forecast to quarterly performance bonus allocation and margin dilution from global operation subcontracting, which carries relatively lower margin rates compared to the company's core operations, despite revenue expansion from the resumption of Dock 2 launching and global operation effects.
What approvals did Samsung Heavy Industries obtain for its Floating Data Center business?
Samsung Heavy Industries obtained concept design approval from the American Bureau of Shipping (ABS) and Lloyd's Register (LR) for a 50-megawatt Floating Data Center (FDC), and signed cooperation agreements with ABB for power system development and with Moosterian (M3) for FDC development in the United States.
When does Samsung Heavy Industries target the launch of its first commercial Floating Data Center?
Samsung Heavy Industries set Q2 2028 as the target service launch date for the first commercial FDC, with the company expected to conclude an order contract in the near term to meet this timeline.
