From LNG Carriers to AI and Nuclear Power: The Next 10 Years for the World’s No. 1 Shipbuilder [MK Corporate Report]

HD Hyundai Heavy Industries’ Remarkable Shift Into a Nuclear Power Beneficiary

사진 확대 HD Hyundai Heavy Industries Ulsan Shipyard

HD Hyundai Heavy Industries Co., Ltd. has long been known as the world’s No. 1 shipbuilder. But over the past year, the labels attached to the company have multiplied noticeably. It is now being described not only as a beneficiary of AI data centers, but also as a company that has entered the nuclear power supply chain. While earnings from merchant ships hit a record high, overseas naval vessels, engine systems for U.S. data centers, and next-generation reactor main equipment were added one after another to its order list. What it builds is increasingly something other than ships, and the market it sells to is expanding from shipowners to navies and big tech companies.

HD Hyundai Heavy Industries Co., Ltd. was created in 2019 when the shipbuilding, offshore, and engine machinery divisions of the former Hyundai Heavy Industries were spun off through a physical division. It was relisted on the KOSPI in 2021. On Dec. 1, 2025, it will absorb HD Hyundai Mipo, a strong player in medium-sized vessels, and launch as the integrated HD Hyundai Heavy Industries, bringing large ships, medium-sized ships, and special-purpose vessels such as warships under one roof. The company has set a target of 37 trillion won in sales by 2035.

사진 확대 [Kim Hyung-kyu Designer] 사진 확대 [Kim Hyung-kyu Designer]

Gas Carriers Drive Quarterly Operating Profit Past 1 Trillion Won for the First Time

Merchant ships remain the core of earnings. In second-quarter sales by vessel type, gas carriers such as LNG carriers and LPG carriers accounted for more than 70%. The order book is also full. HDKSOE shipbuilding affiliates, including HD Hyundai Heavy Industries Co., Ltd., have secured more than 500 vessels, or about 3.5 years’ worth of orders.

The company is currently booking orders centered on deliveries scheduled for 2029, and some contracts are being discussed for delivery as late as 2030. As of June 2026, orders totaled $14.771 billion, reaching 72.3% of the annual target of $20.42 billion. With work secured, the company plans to selectively win orders in the second half of the year, focusing on high-margin vessels such as LNG carriers and LPG carriers within limited slots.

사진 확대 [Kim Hyung-kyu Designer]

The trend is already visible in the numbers. Second-quarter consolidated sales came to 6.3322 trillion won, while operating profit reached 1.0399 trillion won, up 52.7% and 120.6%, respectively, from a year earlier. This was the first time quarterly operating profit exceeded 1 trillion won. The operating margin rose 5 percentage points to 16.4%. Analysts expect full-year sales of 24.8712 trillion won and operating profit of 4.0364 trillion won this year.

사진 확대 An Ultra-Large LNG Carrier Built and Delivered by HD Hyundai Heavy Industries Co., Ltd.

Merchant Ships Generate Cash Now, Warships Will Generate Cash Later… Special-Purpose Vessel Target of 10 Trillion Won by 2035

If merchant ships are money being earned now, warships are money to be earned in the future. The docks, facilities, and workforce used are largely similar to those for merchant ships, but the difference is that the buyer is not a shipowner but a navy. HD Hyundai Heavy Industries Co., Ltd. has set special-purpose vessel sales targets of 7 trillion won in 2030 and 10 trillion won in 2035. This year’s warship order target is $3.016 billion, about three times last year’s estimated result.

The pipeline is also clear. In Peru, cooperation that began in 2024 with a deal to jointly build four surface vessels, including frigates, offshore patrol vessels, and landing ships, with the local state-run SIMA Shipyard is now expanding into submarines. Multiple projects are also under review in Saudi Arabia, Southeast Asia, and Europe. Since warships are ordered according to national defense budgets and fleet replacement plans rather than shipping market conditions, a rise in overseas naval sales would help reduce dependence on the merchant ship cycle.

In the United States, the company is jointly developing an unmanned surface vessel prototype with defense firm Anduril Industries, and it is also working with Huntington Ingalls Industries (HII), the largest defense shipbuilder in the United States, on productivity improvements and automation technologies. In addition, after U.S. President Donald Trump on the 13th signed a national security memorandum allowing foreign shipbuilders that have made direct investments in the United States to build the initial batch of warships overseas, the company is expected to accelerate its planned acquisition of a U.S. shipyard.

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This article has been translated by GripLabs Mingo AI.