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]
中石化炼化工程：公告点评：深化海内外市场开拓，前三季度新签合同额同比大增65.6%