Investment Rating - The report assigns a "Buy" rating for Sinopec Engineering Group (SEG) with a target price of 8 HKD, based on a 12x PE for 2025 [5]. Core Insights - Sinopec Engineering Group is a leading energy and chemical engineering company in China, providing comprehensive solutions across various sectors including oil refining, petrochemicals, and clean energy [12][16]. - The company has demonstrated stable profitability with a gross margin around 10% and a net margin of approximately 5% from 2019 to 2023, alongside a consistent dividend payout ratio of 65% [16][22]. - The domestic market is experiencing a trend of upgrading refining processes and a surge in coal chemical projects, with significant new contracts signed in 2024 [3][4]. - Internationally, SEG is focusing on the MENA region, where the value of awarded oil and gas projects has reached unprecedented levels, contributing to a 32.7% growth in overseas orders [4]. Summary by Sections Company Overview - Sinopec Engineering Group, a subsidiary of Sinopec, is a prominent player in the energy and chemical engineering sector, listed in Hong Kong since May 2013 [12]. - The company operates 12 subsidiaries, providing a wide range of services including engineering consulting, project management, and construction [12][13]. Industry Landscape - The energy and chemical engineering industry has high barriers to entry due to complex processes, specialized requirements, and long project cycles [2][27]. - SEG's main competitors in the domestic market include China Petroleum Engineering Construction and China Chemical Engineering [29]. Domestic Market Trends - The refining sector in China is undergoing structural adjustments, with major projects from both Sinopec and PetroChina aimed at upgrading facilities [3]. - The coal chemical industry is poised for growth, with a projected 295 projects by January 2025, significantly increasing SEG's order intake [3]. International Market Focus - The MENA region is becoming a focal point for SEG, with a record contract value of 94 billion USD for oil and gas projects expected in the upcoming year [4]. - The company has seen a substantial increase in overseas orders, continuing the growth trend established in 2023 [4]. Financial Performance and Valuation - SEG's revenue has remained stable above 50 billion RMB, with a reported revenue of 56.26 billion RMB in 2023, marking a 6% year-on-year increase [16]. - The forecasted net profit for 2024, 2025, and 2026 is 2.525 billion, 2.757 billion, and 2.943 billion RMB respectively, with an EPS of 0.57, 0.63, and 0.67 RMB [5].

Investment Rating - The report maintains a "Buy" rating for Sinopec Engineering (2386.HK) with a current price of HKD 5.54 [2][10]. Core Views - The strategic cooperation between Sinopec Group and China National Petroleum Corporation (CNPC) is expected to enhance long-term development and optimize the company's equity structure [3][4]. - The transfer of shares from Sinopec Group to CNPC, amounting to 21.998 million shares (5% of total shares), strengthens the partnership and resource sharing between the two energy giants [3][4]. - The company has seen a significant increase in new contracts, with a 65.6% year-on-year growth in the first three quarters of 2024, indicating strong market demand and operational capabilities [5][6]. - The diversification of contract sectors, particularly in refining and new coal chemical industries, reflects the company's expanding market presence and operational efficiency [6][7]. - The company is well-positioned to benefit from domestic and international market opportunities, particularly in the Middle East, due to its strategic initiatives and partnerships [7][9]. Summary by Sections Equity Structure and Strategic Cooperation - The share transfer enhances Sinopec Group's control to 61.09% while CNPC becomes the second-largest shareholder with 5% [4]. - This restructuring is seen as a move to improve governance and market recognition, facilitating value realization [4]. Contract Performance - In the first three quarters of 2024, domestic new contracts reached CNY 46.9 billion (up 32%), while overseas contracts surged to CNY 26.6 billion (up 202%), increasing the overseas contract proportion from 20% to 36% [5][6]. - The company’s EPC contract share rose from 54% to 74%, showcasing enhanced total contracting capabilities [5]. Market Opportunities - The domestic market is experiencing rapid development in the petrochemical sector, supported by government policies promoting energy efficiency and carbon reduction [7]. - The Middle East's capital expenditure in refining has exceeded USD 100 billion, presenting significant opportunities for Sinopec Engineering [7][9]. Financial Projections - The report forecasts net profits for 2024-2026 at CNY 2.638 billion, CNY 2.915 billion, and CNY 3.182 billion respectively, with corresponding EPS of CNY 0.60, CNY 0.66, and CNY 0.72 [10][12].

Investment Rating - The report maintains a "Buy" rating for Sinopec Engineering (2386.HK) [3] Core Views - The company signed new contracts worth 73.457 billion yuan in the first three quarters of 2024, representing a year-on-year increase of 65.6% [1] - The overseas market expansion is significant, with overseas contracts accounting for 36% of total new contracts, up from 20% in the same period last year [2] - The company’s business structure is improving, with the proportion of EPC contracts increasing from 54% to 74% [2] - The company has a historical high of 165.8 billion yuan in hand orders, a 40% increase year-on-year, providing strong support for future business development [2] Summary by Sections New Contracts and Market Expansion - In the first three quarters of 2024, domestic new contracts amounted to 46.9 billion yuan, a 32% increase, while overseas contracts reached 26.6 billion yuan, a 202% increase [2] - Major domestic contracts include the Mango Ethylene Project (6.081 billion yuan) and the Huajin Project (5.807 billion yuan) [2] - Significant overseas contracts include the Kazakhstan Silleno Ethylene Cracking Project (1.25 billion USD) and the Saudi Jafurah Phase III Project (900 million USD) [2] Business Structure and Order Diversification - The new contracts span various industries, with rapid growth in refining, new coal chemical, storage and transportation, and others, showing increases of 95%, 1850%, and 256% respectively [2] - The proportion of new contracts from the petrochemical industry decreased from 80% to 58% [2] - The internal contract proportion from Sinopec increased slightly from 30.3% to 41.7% [2] Market Opportunities and Future Growth - The domestic market is seeing accelerated construction of large refining bases and a growing capital expenditure in high-end new materials projects [2] - The overseas market, particularly in the Middle East, is experiencing active capital expenditure exceeding 100 billion USD, with increasing refining production capacity [2] - The company is expected to benefit from the "Belt and Road" initiative and its platform advantages, leading to robust business growth [2] Profit Forecast and Valuation - The report forecasts net profits for 2024-2026 to be 2.638 billion, 2.915 billion, and 3.182 billion yuan respectively, with corresponding EPS of 0.60, 0.66, and 0.72 yuan per share [3] - The company is seen as undervalued with high dividend value under the backdrop of state-owned enterprise reform [2]

Investment Rating - The report maintains a "Buy" rating for Sinopec Engineering (2386.HK) [4] Core Views - Sinopec Engineering has signed a $2.5 billion EPC contract for the Silleno petrochemical complex project in Kazakhstan, marking a significant breakthrough in overseas markets and aligning with the Belt and Road Initiative [2][3] - The project is a joint venture with Kazakhstan's national oil and gas company and reflects Sinopec's commitment to enhancing its overseas market development and high-quality growth [3] - The company has seen a substantial increase in overseas contract signings, with a 117.8% year-on-year growth in new contracts amounting to approximately $2.354 billion in the first half of 2024 [3] - The domestic market is also presenting new opportunities, driven by the rapid development of large refining bases and supportive policies for energy efficiency and carbon reduction [3] Summary by Sections Contract Announcement - Sinopec Engineering has entered into a $2.5 billion EPC contract for the ethylene cracking project at the Silleno petrochemical complex in Kazakhstan [2] Market Opportunities - The company is benefiting from the modernization of China's industrial system and the expansion of the petrochemical industry, with significant capital expenditures in high-end new materials [3] - In the overseas market, active capital expenditures in the Middle East have exceeded $100 billion, providing a favorable environment for Sinopec to secure more contracts [3] Financial Forecasts - The report projects Sinopec Engineering's net profit for 2024-2026 to be approximately 2.638 billion, 2.915 billion, and 3.182 billion yuan respectively, with corresponding EPS of 0.60, 0.66, and 0.72 yuan per share [4] - The company is expected to experience rapid growth in performance, supported by its resource advantages and ongoing market expansion [4]

海 外 公 司 （ 中 国 香 港 ） 国泰君安版权所有发送给上海东方财富金融数据服务有限公司.东财接收研报邮箱.ybjieshou@eastmoney.com p1 海外订单高增速，派息金额与比例双增长 中石化炼化工程(2386) [Table_Industry] 石油 [Table_Invest] 评级： 增持 ——中石化炼化工程 2024 年中报业绩点评 股票研究 /[Table_Date] 2024.08.20 | --- | --- | --- | --- | |----------|-------------------|----------------------------|----------------------------| | | 孙羲昱(分析师) | 杨思远(分析师) | 陈浩越(研究助理) | | | 021-38677369 | 021-38032022 | 021-38031035 | | | sunxiyu@gtjas.com | yangsiyuan026856@gtjas.com | chenhaoyue028692@gtjas.com | | 登记编号 | S0880 ...

Investment Rating - The report maintains a "Buy" rating for Sinopec Engineering (2386.HK) with a current price of HKD 5.70 [2] Core Views - The company achieved a record high in new contract signing for H1 2024, with a significant increase in interim dividend payout ratio [5][6] - The company reported a revenue of CNY 28.6 billion for H1 2024, representing a year-on-year growth of 15%, and a net profit of CNY 1.319 billion, up by 0.12% [3][4] - The company is focusing on high-quality development and optimizing its capital structure, maintaining a stable debt-to-asset ratio of 61.6% as of June 30, 2024 [4] Summary by Sections Revenue Performance - The company reported a revenue of CNY 285.53 billion for H1 2024, with a net profit of CNY 13.19 billion, indicating stable growth amidst challenges in the global economy and domestic chemical market [4] New Contracts and Market Expansion - New contracts signed in H1 2024 reached CNY 500.66 billion, a year-on-year increase of 32.7%, with domestic contracts at CNY 331.13 billion (up 10.6%) and overseas contracts approximately USD 2.354 billion (up 117.8%) [5] - The company is diversifying its contract portfolio, with significant contributions from various sectors including refining and new coal chemical projects [5] Dividend and Share Buyback - The interim dividend per share is set at CNY 0.150, with a payout ratio of 50%, up from 40% in H1 2023, reflecting the company's commitment to shareholder returns [6] - The company has repurchased 13.84 million shares for a total of HKD 67.75 million in H1 2024 [6] Future Outlook and Valuation - The company is expected to benefit from ongoing domestic and international market opportunities, with projected net profits of CNY 2.638 billion, CNY 2.915 billion, and CNY 3.182 billion for 2024, 2025, and 2026 respectively [10] - The report highlights the company's low valuation and high dividend yield as key factors for potential investment [10]

Investment Rating - The report maintains an "Outperform" rating for Sinopec Engineering (Group) [3][12][16] Core Views - In the first half of 2024, the company achieved a total revenue of RMB 28.55 billion, representing a year-on-year increase of 15%, while the net profit attributable to shareholders was RMB 1.32 billion, up 0.1% year-on-year [5][15] - The company reported a mid-term dividend payout ratio of 50%, with a declared dividend of RMB 0.15 per share, resulting in a dividend yield of 2.5% based on the closing price on August 16, 2024 [5][15] - New contract amounts reached a historic high of RMB 50.066 billion in the first half of 2024, reflecting a significant year-on-year growth of 32.7% [6][9] Financial Performance - Total revenue for the first half of 2024 was RMB 28.55 billion, with a net profit of RMB 1.32 billion [5][15] - The company repurchased a total of 13.8 million shares on the Hong Kong Stock Exchange, utilizing HKD 67.8 million [15] - The company’s new contracts included significant projects such as the Huizhou Ethylene project, contributing to the overall growth [6][9] Contract Details - The new contracts included major projects such as the EPC contract for the Fujian Gulei Ethylene project worth RMB 6.081 billion and the EPC contract for the Northern Huajin Fine Chemical project worth RMB 5.807 billion [7][9] - The company’s overseas contracts accounted for 34% of the total new contracts, with a notable year-on-year increase of 117.8% [6][9] Segment Performance - The engineering contracting segment generated revenue of RMB 16.68 billion, up 18% year-on-year, while the construction segment achieved revenue of RMB 13.09 billion, reflecting a 16% increase [9][10] - The design consulting and technology licensing segment saw a decline in revenue to RMB 1.52 billion, down 12% year-on-year [9][10] Earnings Forecast - The forecast for net profits for 2024-2026 is RMB 2.64 billion, RMB 3.05 billion, and RMB 3.62 billion, with corresponding EPS of RMB 0.60, RMB 0.69, and RMB 0.82 [12][16] - The target price is set at RMB 6.30 / HK$ 6.81, based on a P/E multiple of 10.5x for 2024 [12][16]

告中石化煉化工程（集團）股份有限公司 2024 股票代號 : 2386 2024 技術先導型工程公司 半年度報告 創建世界領先 ard iser 18: 144 重要提示 中石化煉化工程（集團）股份有限公司（以下簡稱「中石化煉化工程」或「本公司」）董事會 （以下簡稱「董事會」）及其董事（以下簡稱「董事」）保證本半年度報告所載資料不存在任何 虛假記載、誤導性陳述或重大遺漏，並對其內容的真實性、準確性和完整性負個別及連帶 責任。中石化煉化工程所有董事均出席第四屆董事會第二十次會議。中石化煉化工程董事 長蔣德軍先生、執行董事兼總經理張新明先生、財務總監兼董事會秘書尹鳳兵先生和會計 機構負責人夏吉鵬先生保證本半年度報告中的財務報告真實、完整。 中石化煉化工程及其附屬公司（以下簡稱「本集團」）按國際財務報告準則編製的截至2024 年6月30日止六個月（以下簡稱「本報告期」）的中期財務報告已經香港立信德豪會計師事務 所有限公司進行審計並出具標準無保留意見的審計報告。 本半年度報告包括前瞻性陳述。除歷史事實陳述外，所有本公司預計或期待未來可能或即將發生的業務活動、事件或發展動態的 陳述（包括但不限於預測、目標、估計及經營計 ...

Financial Performance - The company's revenue for the six months ended June 30, 2024, was RMB 28,553,121 thousand, representing a 15.0% increase compared to RMB 24,829,660 thousand in the same period of 2023[10]. - Gross profit for the same period was RMB 2,494,647 thousand, an increase of 11.4% from RMB 2,240,224 thousand in 2023[10]. - Operating profit decreased by 6.6% to RMB 927,462 thousand from RMB 992,967 thousand in the previous year[10]. - The net profit attributable to equity holders of the company was RMB 1,318,677 thousand, showing a slight increase of 0.1% compared to RMB 1,317,070 thousand in 2023[10]. - The gross margin for the first half of 2024 was 8.7%, down from 9.0% in 2023[11]. - The net profit margin decreased to 4.6% from 5.3% in the previous year[11]. - The return on assets (ROA) was 1.6%, slightly down from 1.7% in 2023[11]. - The return on equity (ROE) was 4.2%, compared to 4.3% in the previous year[11]. - The total comprehensive income for the period was RMB 1.30 billion, a decrease of 0.9% compared to the previous year[46]. - The group's profit for the period was RMB 13.19 billion, a slight increase of 0.1% year-on-year[54]. Cash Flow and Financial Position - The company's cash flow from operating activities was negative at RMB (4,200,177) thousand, a significant decline from RMB (1,038,507) thousand in the same period last year, representing a 304.4% decrease[10]. - The company's cash and cash equivalents decreased by RMB 3.46 billion, primarily due to a reduction in financial institution time deposits[93]. - The company's total liabilities decreased to RMB 49.99 billion, down 0.3% from RMB 50.12 billion at the end of 2023[93]. - The company's cash flow from operating activities was negatively impacted by an increase in income tax paid, which rose to RMB (207,791) thousand from RMB (168,498) thousand[162]. - The company's total cash flow decreased by RMB (3,497,751) thousand compared to a decrease of RMB (1,585,214) thousand in the same period of 2023[162]. Shareholder Information - The total number of shares outstanding as of June 30, 2024, is 4,405,146,500, with 67.36% held by the controlling shareholder, China Petroleum & Chemical Corporation[16]. - The company declared an interim dividend of RMB 0.150 per share, with a payout ratio of 50%[24]. - The proposed interim cash dividend for the period ending June 30, 2024, is set at RMB 0.150 per share, subject to applicable taxes[104]. - The interim dividend will be distributed to shareholders registered by the close of business on September 10, 2024, with payment expected by October 28, 2024[104]. Contracts and Projects - In the first half of 2024, the company achieved a revenue of RMB 28.553 billion and a net profit of RMB 1.319 billion, with new contracts signed amounting to RMB 50.066 billion, representing a year-on-year growth of 32.7%[24]. - The overseas new contracts reached USD 2.354 billion, marking a year-on-year increase of 117.8%, with EPC contracts accounting for over 75% of the total[24]. - The total value of uncompleted contracts as of June 30, 2024, was RMB 157.78 billion, up 15.8% from December 31, 2023[31]. - The domestic new contract amount was approximately RMB 33.11 billion, with a year-on-year growth of 10.6%, maintaining industry leadership[33]. - The company signed 137 new contracts in emerging fields such as new energy and new materials, totaling approximately RMB 7.41 billion[33]. Research and Development - Research and development expenses increased to RMB 941.79 million, a rise of 18.7% year-on-year, due to heightened investment in key scientific research projects[50]. - The company initiated a new industrialization research project covering 11 key areas, including high-end, green, and intelligent technologies, to enhance innovation capabilities[24]. - The company filed 440 new patent applications, with 331 being invention patents, accounting for 75.2% of the total[37]. Corporate Governance and Compliance - The company complied with all corporate governance codes as per the Hong Kong Listing Rules during the reporting period[103]. - The audit committee reviewed the semi-annual report and had no dissenting opinions regarding the financial performance[121]. - The company has established a cash dividend distribution agreement with China Securities Depository and Clearing Corporation Limited for H-share investors through the Stock Connect program[105]. Employee Information - As of June 30, 2024, the total number of employees in the group is 15,626, with engineering technical personnel accounting for 78.7%[136]. - Employee costs for the first half of 2024 were approximately RMB 2.46 billion, compared to RMB 2.23 billion for the same period in 2023, representing an increase of about 10.4%[138]. - The gender distribution among employees as of June 30, 2024, shows 27.1% female employees and 72.9% male employees[139]. Market Environment - The macroeconomic environment remains complex, with high international oil prices and sluggish domestic chemical market demand, presenting both challenges and opportunities for the company[27]. - The company aims to enhance its core competitiveness while expanding into new markets and increasing international operations[46].

Investment Rating - The report assigns a "Buy" rating to Sinopec Engineering (2386.HK) with a target price of HKD 6.22, indicating that the current stock price is undervalued [2][9]. Core Views - Sinopec Engineering, backed by Sinopec Group, is positioned to benefit from both domestic and international market opportunities, with a strong financial performance and a commitment to high dividends driving potential value re-evaluation [1][2][8]. Summary by Sections Company Overview - Sinopec Engineering is a major integrated engineering service provider and technology patent holder in the refining and chemical engineering market, primarily controlled by Sinopec Group [15][17]. - The company has a robust financial structure with a debt ratio around 60% and minimal interest-bearing debt, generating significant financial income [1][45]. Business Scale and Competitive Advantage - The company ranks among the top three domestic petrochemical engineering firms, offering a comprehensive range of services across the entire refining engineering value chain [1][28]. - In 2023, the company achieved a revenue of CNY 56.22 billion, with a slight year-on-year increase of 6%, and a net profit of CNY 2.33 billion, reflecting stable profitability [28][35]. Market Opportunities - Domestic market growth is expected to stabilize due to ongoing large-scale projects, while international orders, particularly from the Middle East, are anticipated to surge, with new contracts signed in 2023 amounting to CNY 21.4 billion, a 198% increase year-on-year [1][9]. - The company is well-positioned to leverage Sinopec Group's resources and the Belt and Road Initiative to expand its overseas market presence [1][8]. Financial Performance and Valuation - The company maintains a high dividend payout ratio of 65% and a dividend yield of 9.9%, significantly higher than its A-share peers [1][49]. - The report forecasts revenue growth from CNY 59.2 billion in 2024 to CNY 68.1 billion in 2026, with net profits expected to rise from CNY 2.64 billion to CNY 3.18 billion over the same period [2][3]. Investment Thesis - The combination of high profitability, substantial dividends, and low valuation relative to peers suggests that Sinopec Engineering is poised for a re-evaluation of its market value, particularly in the context of ongoing state-owned enterprise reforms [1][2][8].