During the shipbuilding supercycle, the spotlight has consistently focused on HD Hyundai Heavy Industries, Hanwha Ocean, and Samsung Heavy Industries. However, there is a mid-sized shipbuilder that has quietly been strengthening its capabilities in the shadow of the big three: HJ Shipbuilding & Construction, rooted in Yeongdo, Busan.

From a KRW 100 billion loss to a KRW 67 billion profit in two years… Profit turnaround in 2024 followed by further earnings expansion in 2025

HJ Shipbuilding & Construction posted revenue of KRW 1.9997 trillion and operating profit of KRW 67 billion in 2025. Revenue increased 6% year-on-year, while operating profit surged by 824.8%. This is more than eight times the operating profit of KRW 7.2 billion in 2024. It is the first time in five years, since 2020, that operating profit has exceeded KRW 50 billion.

After recording an operating loss of around KRW 100 billion in 2023, HJ Shipbuilding & Construction turned to the black with KRW 7.3 billion in 2024 and then significantly expanded the scale in 2025. In the securities market, some analysts project the company’s operating profit in 2026 to be in the range of KRW 150 billion to KRW 200 billion.

The order backlog is also solid. In 2024 alone, HJ Shipbuilding & Construction secured KRW 1.75 trillion in new orders in the shipbuilding segment, representing an increase of 150% compared with 2022 and 300% compared with 2023. The combined shipbuilding and construction order backlog amounted to KRW 9.3 trillion at the end of 2024.

The shipbuilding segment has been the main driver of performance improvement. The share of shipbuilding, which had shrunk to 18% of total revenue in 2022, soared to around one-half in 2025. This reflects the impact of expanding its sales network beyond a focus on special-purpose vessels to eco-friendly container ships.

The increase in orders for eco-friendly vessels amid strengthened IMO carbon reduction regulations also acted as a favorable factor. HJ Shipbuilding & Construction has successfully reshaped its business structure by focusing on building vessels that leverage eco-friendly technologies, such as methanol-fueled container ships, LNG-fueled container ships, and LNG bunkering vessels.

Defense is emerging as another pillar of rapid growth. Based on its distinctive technological capabilities, HJ Shipbuilding & Construction won all orders for 32 new patrol killer experimental boats (PKX-B) placed by the Navy and eight air-cushioned high-speed landing craft (LSF-II). In December last year, it also secured an order for four high-speed patrol boats worth about KRW 312.5 billion and a 1,900-ton-class multipurpose chemical response vessel for the Korea Coast Guard worth KRW 68.8 billion, locking in more than three years’ worth of workload.

The company has also accumulated achievements in the MRO business. It won orders totaling KRW 550.4 billion, including performance improvement work for 18 guided-missile patrol killer craft operated by the Navy, overhaul projects for the large-deck amphibious ship Dokdo and LSF-II high-speed landing craft, and one 3,000-ton-class patrol vessel for the Korea Coast Guard.

MSRA signed with the US Navy… Third Korean shipbuilder after Hanwha Ocean and HD Hyundai Heavy Industries

Changes in the global security environment are opening another opportunity for HJ Shipbuilding & Construction, as the Korea–US shipbuilding cooperation project “MASGA (Make American Shipbuilding Great Again)” enters full swing.

Earlier this year, HJ Shipbuilding & Construction signed a Master Ship Repair Agreement (MSRA) with the US Navy, joining the annual KRW 20 trillion-level US Navy ship maintenance, repair, and overhaul (MRO) market over the next five years. It became the third Korean shipyard to obtain qualification for US Navy vessel MRO. The MSRA is a ship repair qualification certified by the US Navy, and shipyards that conclude this agreement can participate in MRO projects for key US Navy vessels, including combat ships and frigates.

Even before signing the MSRA, in December last year HJ Shipbuilding & Construction secured an MRO contract for the 40,000-ton-class logistics support vessel “USNS Amelia Earhart” ordered by the US Navy.

Exports of vessels where HJ Shipbuilding & Construction has strengths, such as high-speed craft and high-speed landing craft, are also expected to gain momentum.

On the 13th, Eco Prime Marine Pacific, the largest shareholder of HJ Shipbuilding & Construction, signed a Memorandum of Agreement (MOA) with HD Hyundai Heavy Industries for the transfer of assets of the Gunsan Shipyard. With an expected sale price in the range of KRW 700 billion to KRW 1 trillion, the Gunsan Shipyard will find a new owner 16 years after its completion in 2010.

The Gunsan Shipyard is a large-scale shipbuilding facility equipped with a 700-meter-class large dock and a 1,650-ton-class Goliath crane. Its annual assembly capacity is about 250,000 tons, and it can build 12 180,000-ton-class bulk carriers per year. It is the key that will allow entry into the large vessel market, which HJ Shipbuilding & Construction had effectively been forced to forgo due to spatial constraints at its Yeongdo Shipyard in Busan.

HD Hyundai Heavy Industries plans to place its block fabrication orders at the Gunsan Shipyard for the next three years, while also providing design services, raw material purchasing代理, and technical support related to automation and smart shipyard systems. For HD Hyundai, which has emphasized “selection and concentration,” this is a win–win deal that streamlines non-core assets and secures financial resources.

Within the industry, some argue that the Gunsan Shipyard should be utilized as a US Navy MRO hub as part of the MASGA project. If this plan is realized, Gunsan will be reborn as a strategic base for Korea’s shipbuilding industry.

Acquisition of Gunsan Shipyard… HJ Shipbuilding & Construction moves to a shipbuilding-centered structure

Eco Prime Marine Pacific is a special purpose company (SPC) established by a consortium of Dongbu Construction and a private equity fund to acquire HJ Shipbuilding & Construction. Through this acquisition, the plan is to operate two shipyards—the Yeongdo Shipyard in Busan and the Gunsan Shipyard—and grow into a global shipbuilding specialist group.

There is a reason why competition between HJ Shipbuilding & Construction and the big three players engaged in defense—HD Hyundai Heavy Industries and Hanwha Ocean—does not seem unusual. Most naval vessels are smaller than large commercial ships, and in a structure where the top-tier competitors among mid-sized shipyards build only commercial vessels, HJ Shipbuilding & Construction’s competitiveness in the naval and special-purpose vessel market stands out relatively more.

An industry official commented, “In the commercial vessel-centered market, the big three are still overwhelming, but in the market centered on naval ships and MRO, the competitive landscape is completely different,” adding, “HJ Shipbuilding & Construction is smaller in scale, but it has a business portfolio that is best aligned with structural changes.”

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