NVGS - Navigator Holdings: Bet On LPG Vessels Demand With Hidden Bonus

2024-01-31 03:28:41 ET

Summary

• Navigator Holdings is a niche player in the LPG transport market with a fleet of 56 vessels and a dominant position in the handysize segment.
• NVGS owns a 50% stake in one formidable asset in Houston, Texas, the world's largest ethylene export terminal. NVGS and Enterprise Products operated the terminal under 50/50 JV.
• NVGS has ample liquidity and adequate capital structure. The company delivers good margins and returns considering its fleet specifics.
• I have been long NVGS for the last month and plan to add more size. My verdict is a buy rating.

Introduction

The shipping market is complex and nuanced. It is not just tankers, containers, and bulk carriers. The key is to focus on the distinctions, knowing the specs of different types and sizes of ships. One of the most niche segments of the shipping industry is LPG transport. It is a tiny market with a high-order book dominated by several companies. It sounds boring and, least to say, unattractive....

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