Analyst Noah Parquette also suggested the Grexit-fuelled selldown of Hellenic-connected shipowners in the US was an opening for investors.
As TradeWinds reported last night, Greece promised its international lenders it would hike its taxation of the industry and strip out the sector’s special tax status gradually.
Parquette notes the Greek pledge comes in one sentence of a wider document and contained limited details, making it hard to gauge any impact.
“We view any material increase in taxes on domestic shipping companies as counterproductive, as this would likely force many ship owners to set-up outside the country, negatively impacting the economy and potentially disrupting a tradition of shipping in Greece that goes back thousands of years,” said Parquette.
“We believe the most realistic option would be an increase in the tonnage tax that is not material enough to cause a mass exodus.”
Greek-linked shipping shares traded in the US have been caught up in wider stock exchange falls linked to both the eurozone crisis and strife on the Chinese stock market.
“Assuming cooler heads prevail, we see headline weakness in these stocks as a potential opportunity to take positions in our overweight (TNP and NNA),” Parquette said.
While the outcome of Greek negotiations with its lenders are far from certain, Parquette does not believe listed companies are in for major pain.
“Even if a materially negative change in the tax structure is implemented, we see the worst case scenario as a one-time increase in G&A expense to move operations out of the country,” he said.
