Ship Ahoy: NOL veers towards profits recovery in 2014

The worst may be over.

According to CIMB, despite the likelihood of outsized losses in 4Q13 following a dramatic fall in spot rates over the past few months, the worst may be over for Neptune Orient Lines and a brighter year lies ahead in 2014.

Here's more from CIMB:

By end-2014, NOL would have completed the vast majority of its vessel charters that were entered into in the pre-GFC days. As a result, we believe the group will largely achieve its desired cost base next year, and we expect it to turn a small profit of less than 1% net margin.

Despite expectations of better earnings in 2014, its near-term share price upside will likely be capped by the possibility of outsized losses in 4Q13. We recommend investors stay on the sidelines for now.