Talk every Monday:
On April 21, 2022, CNOOC officially returned to a shares, and the share price instantly rose 44%, reaching the limit of increase on the first day of listing and triggering the temporary stop mechanism. On April 22, the company’s share price rose by the limit and still performed strongly. We believe that, as a scarce target focusing on the exploration and development of the upper reaches of the ocean, the company has the advantages of low cost and technology, and is expected to continue to benefit from this round of oil price recovery.
The company has a significant competitive advantage. Limited by its own oil and gas resource endowment, China’s oil and gas consumption demand is much higher than its output, resulting in a gradual increase in its external dependence. In 2020, the Petrochina Company Limited(601857) external dependence will rise to 73%. At the same time, from the perspective of resource potential, China is rich in marine oil and gas resources and has great development potential in the future. The company is the largest offshore crude oil and natural gas producer in China and one of the largest independent oil and gas exploration and production groups in the world. In 2021, CNOOC produced 81.86 million tons of crude oil in the whole year, with the best performance in history. The company has the advantages of technology, cost and diversified layout.
There is still room for rise in the follow-up. For the rising space in the later stage, we use the relative valuation method to make a simple comparison between the company and China Petroleum & Chemical Corporation(600028) and Petrochina Company Limited(601857) and . According to the consistent expectation of wind, in 2022, the net profit attributable to the parent company will be around 110 billion yuan, and the EPS will be about 2.3. Considering the leading position of the company in the field of marine exploration and development, and having obvious cost advantages and stronger anti risk ability compared with comparable companies, the company should enjoy a certain valuation premium. We believe that it is reasonable to give 9 times PE in 2022, and the reasonable share price of the company is about 20.7. After the sharp rise in the initial stage of listing, there is still some room for rise.
Investment strategy: the company’s A-share has performed well after listing, mainly as a scarce target focusing on the exploration and development of the upstream of the ocean. The company has the advantages of low cost and technology, and is expected to continue to benefit from this round of oil price recovery. We believe that after the sharp rise in the initial stage of listing, there is still some room for rise in the follow-up.
Market review:
Sector performance: this week, CITIC’s basic chemical sector fell by 4.66%, and the composition of the Shanghai Composite Index fell by 4.09%. Compared with the Shanghai Composite Index in the same period, the basic chemical sector fell by 0.57 percentage points. In terms of sub sectors, the basic chemical sub sectors fell mainly this week, with polyester, viscose and other sub sectors leading the increase; Soda ash, titanium dioxide, lithium chemicals, chlor alkali and other sub sectors led the decline.
Rise and fall of individual stocks: the basic chemical sector led the rise this week, including Cybrid Technologies Inc(603212) , Nanjing Chemical Fibre Co.Ltd(600889) , Jiangsu Lopal Tech.Co.Ltd(603906) , Zhejiang Huasheng Technology Co.Ltd(605180) , etc; Stocks leading the decline include Yangmei Chemical Co.Ltd(600691) , Lushan Xincai, Aba Chemicals Corporation(300261) , Jiangsu Boiln Plastics Co.Ltd(301003) , Xinjiang Tianye Co.Ltd(600075) , etc.
Risk tips: the risk of fluctuations in international oil prices, the risk of repeated global epidemics, etc.
