South Korea's major shipbuilders, led by Hyundai Heavy Industries Co., hit yearly lows on Thursday as investors increasingly fret over their business outlook, analysts said.

Hyundai Heavy, the No. 1 shipbuilder, closed at 88,300 won ($74.50) on the Seoul bourse, down 2.11 percent from the previous session's close.

Samsung Heavy Industries Co. also suffered a 4.78-percent drop to 10,950 won, while Daewoo Shipbuilding & Marine Engineering Co. fell 0.5 percent to end at 5,970 won.

The broader KOSPI index shed 1.28 percent.

The stock slump came as the outlook of the shipyards' business for offshore plants are increasingly murky amid low oil prices, which has prodded major oil producers to refrain from spending big on drill ships and other offshore facilities.

On Wednesday, Daewoo Shipbuilding said it has terminated a 703 billion won deal to build a drill ship as its client did not pay an intermediate payment for the contract.

"The news reminded investors that the shipbuilders' offshore facility business is not good amid low oil prices," said Han Young-soo, an analyst at Samsung Securities.

The three shipyards have already logged worse-than-expected losses in the second quarter, largely due to the delivery of low-priced ships and a delay in the construction of loss-making offshore facilities.

The country's big three shipyards racked up a combined loss of 3.78 trillion won in the April-June period, a new record. And their combined operating loss is estimated at 4.75 trillion won, also marking the largest-ever shortfall.

Daewoo Shipbuilding & Marine Engineering suffered a net loss of 2.39 trillion won in the April-June period, the largest red figure among the three players. Samsung Heavy Industries racked up a loss of 1.15 trillion won during the April-June period.

Local shipyards reported massive losses last year largely due to a rise in shipbuilding costs and losses from offshore plant construction. (Yonhap)