Changjiang Securities·2025-05-01 05:45Investment Rating - The investment rating for Sinopec (600028.SH) is "Buy" and is maintained [8]. Core Views - Sinopec reported a total operating revenue of 735.36 billion yuan for Q1 2025, a year-on-year decrease of 6.91%. The total profit reached 18.25 billion yuan, down 32.6% year-on-year, and the net profit attributable to shareholders was 13.26 billion yuan, a decrease of 27.58% year-on-year. The company is focusing on upstream resource enhancement and cost reduction while maintaining shareholder returns with a cash dividend rate of 69% for 2024 [2][6]. Summary by Sections Financial Performance - In Q1 2025, Sinopec achieved total operating revenue of 735.36 billion yuan, a decrease of 6.91% year-on-year. The total profit was 18.25 billion yuan, down 32.6% year-on-year, and the net profit attributable to shareholders was 13.26 billion yuan, a decrease of 27.58% year-on-year [2][6]. Upstream Operations - The company made progress in increasing reserves and production, with an oil and gas equivalent output of 130.97 million barrels in Q1 2025, a year-on-year increase of 1.7%. Natural gas production was 3,684.3 billion cubic feet, up 5.1% year-on-year. Despite a 9.0% drop in international oil prices, Sinopec's oil and gas prices fell by 5.2% and 3.5%, respectively [11]. Refining and Chemical Business - In Q1 2025, Sinopec processed 6.2 million tons of crude oil, a decrease of 1.8% year-on-year. The refining segment's profit before tax was 2.39 billion yuan, down 65.25% year-on-year. The chemical segment faced challenges due to low margins but increased production of profitable products, resulting in a loss of 1.32 billion yuan, a reduction in losses by 288 million yuan year-on-year [11]. Sales and Marketing - The refined oil sales division leveraged its integrated advantages to maintain market share, achieving total sales of 55.59 million tons in Q1 2025. The profit before tax for the marketing and distribution segment was 4.87 billion yuan, down 43.92% year-on-year [11]. Shareholder Returns - For 2024, Sinopec proposed a final cash dividend of 0.14 yuan per share, with a total cash dividend of 0.286 yuan per share, resulting in a dividend payout ratio of 69%. The company plans to implement a three-year shareholder return plan and continue share buybacks [11]. Earnings Forecast - The expected EPS for Sinopec for 2025, 2026, and 2027 are 0.46 yuan, 0.48 yuan, and 0.49 yuan, respectively. The corresponding PE ratios are projected to be 12.23X, 11.76X, and 11.38X [11].