2024-08-29 08:40Investment Rating - The report maintains a "Buy" rating for the company, indicating an expectation that the stock price will outperform the benchmark index by more than 20% in the next 6-12 months [3][8]. Core Views - The company's operational performance is steadily improving, with a high dividend payout ratio maintained [3][4]. - The report highlights significant growth in operating cash flow and slight improvements in sales gross margin, suggesting a positive outlook for future performance [2][4]. - The exploration and development segment has seen both volume and price increases, with cost reduction and efficiency improvements noted [2][4]. - The refining segment's crude processing volume remains stable, although diesel sales have declined due to weak demand [2][4]. - Capital expenditures are expected to increase in the second half of the year, with a high dividend payout ratio maintained [2][4]. Summary by Sections Financial Performance - In the first half of 2024, the company achieved operating revenue of 1,576.13 billion RMB, a year-on-year decrease of 1.10%, while net profit attributable to shareholders was 35.70 billion RMB, an increase of 1.69% [2][4]. - For Q2 2024, operating revenue was 786.16 billion RMB, down 2.02% year-on-year, with net profit attributable to shareholders at 17.39 billion RMB, up 15.84% year-on-year [2][5]. Cash Flow and Profitability - The net cash flow from operating activities reached 42.27 billion RMB in the first half of 2024, a year-on-year increase of 53.36% [2][4]. - The gross margin for sales improved slightly to 15.77%, up 0.58 percentage points year-on-year [2][4]. Exploration and Development - The average selling price of crude oil was 3,923 RMB/ton, an increase of 8.2% year-on-year, while natural gas prices decreased by 3.1% to 1,894 RMB/thousand cubic meters [2][4]. - Oil and gas equivalent production reached 257.66 million barrels, a year-on-year increase of 3.1% [2][4]. Refining and Marketing - The company processed 127 million tons of crude oil in the first half of 2024, a slight increase of 0.1% year-on-year [2][4]. - Diesel sales declined by 6.8% year-on-year to 39 million tons due to weak demand [2][4]. Capital Expenditure and Dividends - Capital expenditures for the first half of 2024 were 55.89 billion RMB, with plans for 117.1 billion RMB in the second half [2][4]. - The board proposed a cash dividend of 0.146 RMB per share for 2023, with a payout ratio of 49.77% [2][4]. Valuation - The report raises profit forecasts for 2024-2026, expecting net profits of 71.73 billion RMB, 81.76 billion RMB, and 85.68 billion RMB, respectively [2][3]. - The current price-to-earnings ratio is projected at 12.0 times for 2024, decreasing to 10.1 times by 2026 [3][4].