Zhi Tong Cai Jing·2025-08-01 06:16Core Viewpoint - Sinopec (00386) experienced a significant decline in stock price, dropping over 5% following the release of its profit forecast for the first half of 2025, indicating a substantial year-on-year decrease in net profit due to various market pressures [1] Financial Performance - Sinopec expects a net profit of 20.1 billion to 21.6 billion RMB for the first half of 2025, representing a year-on-year decline of 39.5% to 43.7% [1] - For the second quarter, the anticipated net profit attributable to shareholders is projected to be between 6.8 billion and 8.3 billion RMB, reflecting a year-on-year decrease of 52.1% to 60.7% and a quarter-on-quarter decline of 37.2% to 48.5% [1] Market Conditions - The decline in profits is primarily attributed to a sharp drop in international oil prices, ongoing competition in the oil and petrochemical markets, and low margins in the chemical market [1] - Everbright Securities has revised its profit forecasts for Sinopec for 2025 to 2027, estimating net profits of 45.3 billion (down 15.4%), 55.5 billion (down 3.1%), and 66.2 billion (down 7.6%) RMB respectively [1] Future Outlook - Despite the current challenges, the company is committed to long-term strategies and is proactively investing in new energy and new materials businesses [1] - As the overall chemical market improves and new production capacities come online, the company's performance is expected to strengthen, leading to a positive long-term growth outlook [1] - The company maintains a "buy" rating for both A-shares and H-shares, reflecting confidence in its future growth potential [1]