Sinopec Corp.(600028) Minsheng Securities·2024-10-29 07:01Investment Rating - The report maintains a "Recommended" rating for Sinopec (600028.SH) with a target price of 6.44 CNY per share [4]. Core Views - The report highlights a significant decline in profits due to reduced inventory gains and lower petrochemical product margins, with a year-on-year decrease in net profit of 52.1% in Q3 2024 [1][2]. - Despite the challenges, the exploration business is expected to support profitability, and domestic demand improvements may enhance the profitability of refining and chemical operations [2]. Financial Performance Summary - For the first three quarters of 2024, Sinopec reported total revenue of 23665.4 billion CNY, a year-on-year decrease of 4.2%, and a net profit attributable to shareholders of 442.5 billion CNY, down 16.5% year-on-year [1]. - In Q3 2024, the company achieved revenue of 7904.1 billion CNY, a year-on-year decline of 9.8%, and a net profit of 85.4 billion CNY, down 52.1% year-on-year [1][2]. - The total EBITDA for 2024 is projected to be 183306 million CNY, with a net profit forecast of 62682 million CNY [5][6]. Segment Performance - Exploration and production segment reported a net profit of 143.4 billion CNY, with a slight decrease of 10.6% compared to the previous quarter [2]. - The refining segment experienced a net loss of 7.5 billion CNY, while the marketing and distribution segment's profit fell by 56.5% to 33.9 billion CNY [2]. - Chemical segment reported a net loss of 26.5 billion CNY, reflecting a significant decrease in profitability [2]. Price and Earnings Forecast - The expected earnings per share (EPS) for 2024, 2025, and 2026 are projected to be 0.44 CNY, 0.46 CNY, and 0.48 CNY respectively, with corresponding price-to-earnings (PE) ratios of 14, 14, and 13 [3][5]. - The forecasted net profit for 2024, 2025, and 2026 is 54097 million CNY, 56136 million CNY, and 58554 million CNY respectively [3][5].