Chinese shipyard June newbuild order share rose to 85%; demand for major vessel types improved but gas carriers remained pressured

Overview

This is Goldman Sachs's July global shipyard monthly tracker, focusing on June 2026 global newbuild order volume, order value, orderbook, freight rates, costs, and vessel-type dynamics. The report states that although global new order value declined month-over-month due to weaker offshore and gas-ship orders, demand in major vessel types such as container ships, tankers, and bulkers improved. Chinese shipyards have clear advantages in these types, so June new order market share rose to 85%.

Core views

Core views include: first, June global newbuild order volume fell 9% month-over-month but rose 1% year-over-year, while new order value fell 39% month-over-month and 9% year-over-year, mainly due to offshore, LPG, and LNGC; second, tanker order momentum improved, bulker order volume rose sharply month-over-month, and container ship orders were down month-over-month but mainly reflected replacement demand for smaller vessels; third, Chinese shipyard share rose significantly, with Korean share dropping from 40% in May to 9% in June; fourth, order momentum improved at Yangzijiang and Hengli, and Hengli is expected to continue winning orders given shorter order coverage and potential capacity expansion; fifth, the report remains constructive on Namura, Mitsui E&S, and Tokyo Keiki benefiting from replacement of aging fleets, cleaner-ship transition, Japan's shipbuilding revival, and demand for marine equipment aftersales and newbuild.

Analysis framework

The report uses a monthly industry data tracking framework, combining Clarkson newbuild orders, orderbook, freight indices, regional shares, segment splits, and shipyard order coverage to compare global shipping cycle conditions and covered company order momentum; it also evaluates demand, margin, and valuation risks using dynamic ROI, steel plate prices, ship equipment PPI, and company target price methodology.

Methodology notes

• industry_trackingGlobal Shipyard Logbook

  Monthly shipbuilding orderbook tracking

  Demand and shipyard pricing power are assessed through newbuild volume, new order value, orderbook, order coverage, freight indices, and regional share.

• Valuation methodsP/B vs ROE

  Yangzijiang Shipbuilding target price approach

  The report says Yangzijiang has a 12-month target price of SGD 4.70 based on P/B versus ROE valuation, using a 2.5x target P/B, FY2026E BVPS, 24% normalized cyclical ROE, 10.2% cost of equity, and 1% long-term growth.

• Valuation methodsSOTP / P/E / P/B

  Japanese coverage company target price approach

  Tokyo Keiki uses target P/E, Mitsui E&S uses SOTP with 10x-19x P/E applied by segment, and Namura uses target P/B, all discounted to FY3/27.

• factor_profileGS Factor Profile

  Growth, financial returns, valuation multiples, and combined percentiles

  The Goldman Sachs Factor Profile benchmarked to covered stocks and peers compares growth, financial returns, valuation multiples, and composite attributes to provide investment context.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Yangzijiang Shipbuilding

  Covered shipbuilder, cited with Buy rating and a 12-month target price of SGD 4.70

  Strengths

  Order momentum in June improved versus April-May; order coverage of 3.4x is slightly below global average, and expected Hongyuan Shipyard capacity additions should support future order intake.

  Weaknesses

  June new orders were still 24% below the Q1 2026 average, and the company faces stronger competition from Hengli's improving mix and expansion.

  Comparison

  Compared with Hengli, Yangzijiang has a longer coverage period, though still below global average; Hengli's shorter coverage may support more aggressive order capture.

  Risks

  Steel prices higher than expected, stricter USTR scrutiny of China shipbuilding, bigger-than-expected ASP declines, and faster-than-expected capacity expansion by other yards.

• Hengli

  Key watched shipyard, not disclosed as a target-price subject

  Strengths

  Won 16 6k TEU container ships in June, with order volume up 102% versus April-May average; captured about 13% of global tanker orders and has shorter order coverage.

  Weaknesses

  Rapid expansion and large order wins require execution capability validation; potential Phase 4 expansion could alter industry supply dynamics.

  Comparison

  Compared with Yangzijiang, Hengli benefits more from shorter order coverage, but is also more dependent on capacity ramp-up and order execution.

  Risks

  Delivery delays, slower-than-expected capacity ramp, freight rate declines, rising steel prices, and intensified industry competition.

• Namura Shipbuilding Co.

  Covered company, cited with Buy rating and 12-month target price of ¥5,600

  Strengths

  Benefits from replacement of aging fleets, structural transition to greener ships, and long-term revival theme in Japanese shipbuilding.

  Weaknesses

  Production capacity and cost are highly sensitive to the shipping cycle.

  Comparison

  Compared with Chinese shipyards, Japanese yards have lower new order share but may benefit from the Japanese shipbuilding revival theme.

  Risks

  Sudden industry capacity increases, higher steel prices, operational execution issues, and falling ship prices.

• Mitsui E&S Co.

  Covered company, cited with Buy rating and 12-month target price of ¥7,000

  Strengths

  Marine propulsion systems, logistics systems, and related businesses can benefit from ship replacement and equipment demand.

  Weaknesses

  Segment valuation depends on different annual profit forecasts; input costs and execution risk are significant.

  Comparison

  Compared with pure shipbuilders, Mitsui E&S is more tilted toward marine equipment and systems, with both newbuild and aftersales demand as drivers.

  Risks

  Rapid cost escalation, weakening container demand, production disruptions, and price declines.

• Tokyo Keiki

  Covered company, cited with Buy rating and 12-month target price of ¥8,800

  Strengths

  Has roughly 60% global share in marine autopilots and gyrocompasses, with expected growth in aftersales and newbuild demand and support from defense demand.

  Weaknesses

  Profit growth depends on sustained shipping demand, newbuild, and aftersales activity.

  Comparison

  Compared with shipbuilders, Tokyo Keiki is more of a high-share marine equipment supplier with different cyclical exposures.

  Risks

  Defense demand deterioration, softer shipping demand, and competitive pressure leading to price declines.

Key data

• June global newbuilding order volume5.3mn CGTs / 5.5mn CGTsThe body text discloses 5.3mn CGTs, while tables and some sections show roughly 5.5mn CGTs; magnitude is consistent, with -9% m/m and +1% y/y.
• June global new order valuearound US$15.3bn-15.5bnDown 39% month-over-month and 9% year-over-year; about 70% of the month-over-month value decline came from fewer offshore orders.
• Chinese June new order market share85%Highest since Aug 2024; 87% when LNGC is excluded.
• Korean June new order market share9%Markedly down from 40% in May 2026; 7% when LNGC is excluded.
• Global orderbookabout 207mn CGTsBroadly flat month-over-month in June; container ships, tankers, and bulkers each account for about 30%, 20%, and 16%, respectively.
• Global order coverage3.7xChina, Korea, and Japan are about 4.1x, 3.2x, and 2.2x, respectively.
• Clarksons newbuilding price index185, up 0.1% m/mImproved for the third consecutive month, 2.4% below the Sep 2024 peak and 48% above end-2020.
• Tanker dynamic ROI36%Up from 25% before the Hormuz Strait reopening; under the report's VLCC TCE base case it could reach 41%.
• Container dynamic ROI31%As of 3 July 2026, based on 6-12 month TCE, it remained at 31%.
• Hengli order coverage2.8xBelow global average when Phase 3 capacity is included, and may fall below 2x if Phase 4 expansion is implemented.

Impact & implications

At the industry level, higher Chinese share in mainstream-vessel orders strengthens the competitive advantage of China's shipbuilding supply chain and capacity expansion. At the company level, Hengli's shorter order coverage and a large potential pipeline of container orders imply improved mix, but this could also increase competitive pressure on Yangzijiang. For Japanese shipyards and equipment suppliers, replacement of aging fleets, demand for greener ships, and the revival of Japan's shipbuilding industry provide medium- to long-term support.

Risks

• LPG and LNGC order negotiations have slowed, and recovery in gas-ship demand is uncertain.
• Falling offshore demand may continue to drag on global new order value.
• Rapid capacity expansion by other yards could intensify competition and pressure ASPs.
• Input costs such as steel plate costs higher than expected could compress shipyard profit margins.
• If regulatory policy from the USTR and others becomes stricter on China-built vessels, it could affect Chinese order flow and valuations.
• Delivery delays, delayed ramp-up of new capacity, or production issues could affect revenue recognition and profitability.
• Shipping is highly cyclical, and Clarkson/CRSL data and forecasts contain estimation errors.

What to watch

• Whether Hengli is officially included in MSC's potential order for up to 20 dual-fuel 20k TEU container ships, and the effect of that order on the orderbook and mix.
• Whether Hengli Phase 4 expansion is implemented and how it affects order coverage and industry supply.
• Whether Chinese, Korean, and Japanese new order shares continue the sharp divergence seen in June.
• Whether LPG and LNGC order negotiations resume as geopolitical uncertainty evolves.
• Whether tanker TCE and dynamic ROI remain at high levels, especially for VLCC demand and delivery cadence.
• Whether Clarkson's newbuilding price index continues to improve and how steel prices impact shipyard margins.
• How much additional capacity at Yangzijiang's Hongyuan Shipyard contributes to subsequent order wins.