ST Songfa (603268.SS) Analysis Report on Surge in Shipbuilding Orders and Earnings Reversal
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Based on the data I have collected, I now provide you with an in-depth analysis report on ST Songfa (Guangdong Songfa Ceramics 603268.SS).
Guangdong Songfa Ceramics Co., Ltd. (stock code: 603268.SS) is a listed company focusing on ceramic products. In recent years, it has actively promoted business transformation, expanding from traditional ceramic manufacturing to the shipbuilding sector [1]. As of December 26, 2025, the company’s market capitalization reached 83.77 billion USD, and the current stock price is 86.29 USD.
In terms of stock price performance, ST Songfa has shown an extremely strong upward trend [1]:
| Statistical Period | Increase |
|---|---|
| 5 days | +11.92% |
| 1 month | +23.84% |
| 3 months | +87.06% |
| 6 months | +128.22% |
| YTD | +121.43% |
| 1 year | +117.25% |
| 3 years | +530.77% |
| 5 years | +399.65% |
From August 14, 2024 to December 26, 2025 (333 trading days), the stock price rose from 12.53 USD to 86.29 USD, an increase of up to 588.67%, with a price range of 11.89 USD to 89.50 USD and a volatility of 3.84% [1].
From 2024 to 2025, the global shipbuilding industry has experienced a significant order growth cycle. According to industry data, Yangzijiang Shipbuilding (stock code: BS6.SGX) received approximately 14.6 billion USD in new ship orders in 2024, hitting a record high [2]. As of November 2025, the company’s order backlog was worth about 22.8 billion USD, including 245 ship orders [2].
Data from the China Association of the National Shipbuilding Industry shows that global new ship orders increased significantly year-on-year in 2024, especially in container ships, bulk carriers, and LNG carriers [2]. COSCO Shipping recently placed an order for 87 new ships worth 50 billion RMB (approximately 7 billion USD), further confirming the industry’s prosperity [3].
According to relevant industry analysis reports, ST ship-related stocks showed an obvious order growth trend from 2024 to 2025 [4]. Data charts show that ST ship orders increased significantly in 2024 and continued to grow in 2025, reflecting positive signals of overall industry recovery [4].
ST Songfa’s financial indicators show typical characteristics of a transformation period [1]:
- Price-to-Earnings Ratio (P/E)：61.32x —— at a relatively high level, reflecting market expectations for the company’s future growth
- Price-to-Book Ratio (P/B)：9.54x —— also in a relatively high valuation range
- Return on Equity (ROE)：43.34% —— excellent performance, showing strong shareholder return capacity
- Net Profit Margin：10.62% —— relatively stable profitability
- Operating Profit Margin：15.40% —— acceptable profitability of core business
Liquidity indicators show certain financial pressure [1]:
- Current Ratio：0.98 —— below the warning line of 1, indicating weak short-term solvency
- Quick Ratio：0.78 —— also below the ideal level
- Free Cash Flow：-53,899,494 USD —— negative cash flow, which is a risk signal worthy of attention
Financial analysis shows that the company adopts conservative accounting policies with a high depreciation/capital expenditure ratio [1]. This means that the company’s actual profitability may be better than the book data, and there is room for improvement in the future as investments gradually mature.
The company’s debt risk is assessed as
- Low current ratio and quick ratio
- Continuous negative free cash flow
- Large capital expenditures during business transformation
According to technical analysis results, ST Songfa is in a
- Latest Closing Price：86.29 USD (December 26, 2025)
- Trend Type：Rising trend
- Trend Score：4.0 points (base 4.0 points, bonus 0.0 points)
| Indicator | Value | Signal |
|---|---|---|
| MACD | No crossover | Bullish |
| KDJ | K:76.3, D:60.9, J:107.3 | Bullish |
| RSI (14) | Normal interval | Neutral |
| Beta | -0.27 | Negatively correlated with market |
- Support Level：79.90 USD (20-day moving average)
- Resistance Level：89.50 USD
- Next Target Level：93.32 USD
Technical analysis shows that the stock had a buy signal on December 23, but the trend validity needs to be confirmed after breaking through the 89.50 USD resistance level [1].
The global shipbuilding industry is at the beginning of a new upward cycle. According to industry data, the value of order backlog increased from 8.5 billion USD in December 2021 to 24.4 billion USD in December 2024, then slightly fell to 22.8 billion USD in 2025 [2]. This historically high order backlog provides shipbuilding enterprises with years of revenue visibility.
Experience from leading enterprises such as Yangzijiang Shipbuilding shows that sufficient order backlog can be converted into sustained revenue growth. In the first three quarters of 2025, the company achieved revenue of about 26.5 billion RMB, a year-on-year increase of about 10% [2]. Net profit reached about 6.8 billion RMB, a year-on-year increase of more than 60% [2].
“Green” ships (environmentally friendly ships) account for more than 70% of the order backlog value, reflecting the industry’s trend towards sustainable development [2]. This provides product upgrading and premium space for shipbuilding enterprises with technical capabilities.
The delivery cycle of the shipbuilding industry is usually 3-5 years, which means that the large number of orders obtained in 2024 will continue to be converted into revenue in the next few years. If ST Songfa can successfully obtain and execute these orders, it will gain considerable revenue certainty.
The current 61.32x P/E ratio and 9.54x P/B ratio are at relatively high levels [1]. If the company’s performance fails to continue to exceed expectations, the stock price may face correction pressure.
Continuous negative free cash flow is an important risk signal [1]. During the business expansion period, moderate negative cash flow may help growth, but if it lasts too long, it may affect the company’s financial stability.
Current ratio below 1 and low quick ratio indicate that the company has short-term debt repayment pressure [1], and it is necessary to pay attention to the company’s debt structure and refinancing capacity.
The shipbuilding industry is highly competitive, with shipbuilding enterprises from China, South Korea, and Japan competing fiercely in the global market. As a latecomer, ST Songfa needs to face the competitive pressure from existing leading enterprises.
Factors such as international trade frictions, exchange rate fluctuations, and geopolitical tensions may affect the acquisition and execution of new ship orders [2]. In particular, Sino-US trade frictions and potential changes in port fee policies bring uncertainty [2].
ST Songfa (603268.SS) is at a key node of transforming from traditional ceramic manufacturing to shipbuilding business [1]. Comprehensive assessment from the following dimensions:
| Evaluation Dimension | Score | Explanation |
|---|---|---|
| Industry Prospects | ★★★★☆ | Shipbuilding industry is in an upward cycle with sufficient orders |
| Performance Growth | ★★★★☆ | Strong stock price performance and excellent ROE |
| Valuation Level | ★★★☆☆ | High P/E and P/B ratios, with correction risk |
| Financial Risk | ★★☆☆☆ | Cash flow and liquidity under pressure, high debt risk |
| Technical Form | ★★★★☆ | In rising trend, to be confirmed breakthrough |
Support Factors:
- Global shipbuilding industry is in a boom cycle with record high order backlog [2]
- Excellent ROE performance, with good shareholder return capacity [1]
- Strong growth momentum in both stock price and performance [1]
- Green ship transformation brings product upgrading opportunities [2]
Hindrance Factors:
- High valuation may limit further upside potential of stock price [1]
- Cash flow and liquidity conditions need improvement [1]
- As a new entrant in the shipbuilding industry, facing intense market competition
- High financial risk, need to continuously monitor debt status [1]
Investors need to pay close attention to changes in the following indicators:
- Actual acquisition of shipbuilding orders
- Improvement of free cash flow
- Trend of current ratio and quick ratio
- Quality and profit margin of new orders
- Changes in industry competition pattern
[1] Jinling AI Financial Database - ST Songfa (603268.SS) Company Overview, Stock Price Data and Technical Analysis
[2] Seatrade Maritime - Yangzijiang Shipbuilding Order Book Analysis 2024-2025 (https://www.seatrade-maritime.com)
[3] The Maritime Executive - COSCO Shipping Places Record-Breaking RMB50 Billion Newbuild Order (https://maritime-executive.com)
[4] Industry Analysis Report - ST Ship Company 2024-2025 Order Growth Data Chart
Insights are generated using AI models and historical data for informational purposes only. They do not constitute investment advice or recommendations. Past performance is not indicative of future results.
About us: Ginlix AI is the AI Investment Copilot powered by real data, bridging advanced AI with professional financial databases to provide verifiable, truth-based answers. Please use the chat box below to ask any financial question.