中游磨底蓄势，下游复苏向好

Investment Rating - The report maintains an "Overweight" rating for the oil and gas sector and the basic chemicals sector [6] Core Viewpoints - The industry is expected to see a recovery starting in 2026, driven by improved internal and external demand resilience and the optimization of supply patterns [2] - The overall performance of the bulk chemical cycle products remains weak, but signs of supply-demand improvement are emerging in certain sectors [3] - The oil price has been fluctuating but is expected to have long-term cost support, with high-dividend companies having potential investment opportunities [2][3] Summary by Sections Industry Overview - The chemical industry has seen a decline in capital expenditure growth since 2025, which, combined with a reduction in excess capacity, is expected to support a gradual recovery in demand [2][10] - The overall revenue for the basic chemicals and oil and gas sector in the first nine months of 2025 was CNY 74,760 billion, down 5% year-on-year, with a net profit of CNY 3,929 billion, also down 6% year-on-year [14][21] Subsector Performance - Oil and Gas: The oil price has been under pressure due to geopolitical tensions and OPEC+ production increases, leading to a decline in profitability for oil and gas sales and refining sectors [17][24] - Fertilizers and Pesticides: The agricultural demand is growing, and overseas orders are recovering, leading to improved profitability in the pesticide sector, while fertilizer companies benefit from expanded export price differentials [4][17] - Chlor-alkali and Related: The fluorochemical sector remains strong, while chlor-alkali and silicon chemical sectors are facing weak profitability due to supply-demand imbalances [4][17] - Plastics and Polyurethanes: The profitability of plastic products and additives has improved due to demand from the automotive and home appliance sectors, alongside cost improvements [4][17] - Electronic Materials: Continued growth in downstream demand supports the high-end and fine chemical sectors, with domestic substitution trends ongoing [4][17] Recommendations - Recommended stocks include: - Yuntianhua (CNY 44.66, Buy) - Senqilin (CNY 26.16, Buy) - China National Petroleum Corporation (CNY 11.00, Overweight) - Juhua Co., Ltd. (CNY 42.56, Buy) - Luxi Chemical (CNY 16.66, Buy) - Sailun Tire (CNY 19.63, Buy) - Hualu Hengsheng (CNY 29.40, Buy) - Meihua Biological (CNY 12.70, Buy) - Wanwei High-tech (CNY 7.26, Overweight) [7]