Shares of Pacific Basin (02343) climbed more than 5% intraday, with the stock last trading up 4.21% at HK$4.33, on turnover of HK$35.98 million. The surge comes as geopolitical tensions in key shipping lanes escalate—while the Strait of Hormuz remains a lingering concern, the situation in the Bab el-Mandeb Strait has now heated up sharply. Shipbroker Gibson noted that the VLCC market has reached unprecedented levels, with TD3C rates soaring above $1.24 million per day.

CICC has released a research report stating that, given recent freight rates exceeding its expectations, the firm has raised its 2026/2027 earnings forecasts for Pacific Basin by 37.1% and 42.7%, respectively, to $241 million and $257 million. At current prices, this implies a price-to-earnings ratio of 11.4 times for 2026 and 10.7 times for 2027. The brokerage maintains its "Outperform" rating and has lifted its target price by 33.5% to HK$4.54 per share, corresponding to 12.5 times 2026 earnings and 11.7 times 2027 earnings, representing a 9.66% upside from the current share price.

CICC is also set to host a non-deal roadshow for the company this Friday. Meanwhile, small dry bulk freight rates have continued to rise recently—as of September 17, the BSI and BHSI indices were up 2.9% and 5.3% week-on-week, respectively, and up 18.1% and 21.7% year-on-year. The brokerage is optimistic that Pacific Basin will benefit from rising freight rates and deliver a solid full-year earnings performance.