Taiwan’s TS Lines makes third attempt at an IPO in Hong Kong

TAIWAN : TS Lines has made a third attempt at an initial public offering on the Hong Kong Stock Exchange. Earlier attempts in 2022 and 2023 stalled as the container shipping market corrected after the Covid-19-enabled boom.

However, having submitted another prospectus on 30 May, TS Lines appears to have been encouraged to try again due to the current renewed bull run.

The company, which has appointed JP Morgan and China Merchants Securities as its listing sponsors, said that despite reduced earnings in 2023, it looks favourably at growing demand for shipments from East Asia to India and the Middle East.

TS Lines, founded by Chen Te-siang in 2001, reported revenue of US$874.6 million, down from US$2.44 billion in 2022, as the pandemic-induced windfall evaporated. As a result, net profit plunged to US$20.4 million, substantially lower than the US$1.07 billion and US$1.08 billion achieved in 2022 and 2021. As the market corrected, TS Lines abandoned its Transpacific and Asia-Australia/New Zealand services in 2023.

TS Lines’ prospectus stated, “We have remained resilient and versatile and consistently generated positive operating cash flows over the past 10 years across several shipping industry cycles, even during 2023, being one of the most challenging years during that period.”

TS Lines is now the 20^th largest liner operator, running 44 ships of 102,982 TEU; 36 vessels are owned.

In 2023, the company’s Asia-Indian Subcontinent volumes totalled 153,804 TEU, nearly 11% of the 1.47 million TEU carried by TS Lines that year. Asia-Indian subcontinent volumes grew materially, from 12,103 TEU in 2021.

In 1Q 2024, TS Lines’ volumes went up from the year-ago period to 380,000 TEUs, and the company has started services connecting China and East Asia to the Middle East, citing “prosperous” export flows from East Asia to the Middle East.

The prospectus stated that since 2023, TS Lines has optimised its fleet in response to market conditions, selling 10 vessels and returning 12 chartered-in vessels. The company has taken delivery of three new 7,000 TEU vessels since 2024; two ships, TS Keelung and TS Hongkong, have been assigned to Asia-Indian Subcontinent services, while the other ship has been chartered out for a year, from March 2024.

Five more 7,000 TEU ships will be delivered to TS Lines between June 2024 and 2027. The company said the vessels could be self-operated or chartered out to other operators.