GRIN - Grindrod Shipping (GRIN) - Expected Solid Finish to Year Warrants Higher Target

Dry bulk market thesis intact. Hard to avoid volatility, but intermediate outlook remains promising. Dry bulk TCE rates have moved higher on firm demand plus port congestion and coal shortages. Also, the order book remains muted, and the new carbon emission regulations (EEXI) in January 2023 could trigger slow steaming that effectively lowers supply. While Chinese industry could be curtailed ahead of 2022 Winter Olympics and volatility/seasonality is possible, there is no doubt that dry bulk bulk rates have been higher than expected. Comments from last Tuesday's Capital Link Dry Bulk Sector Panel reinforced our positive view.3Q2021 forward cover was high at 75%, but commercial strategy should capture higher 4Q2021 TCE rates. Increasing 2021 EBITDA estimate to $182.4 million from $158.8 million. Our 3Q2021 EBITDA estimate increases slightly to $61.9 million based on TCE rates of $31.3k/day for Supras/Ultras and $25.9k/day for Handys. Our 4Q2021 EBITDA moves much higher to $65.2 million based on... Read More >>