Shanghai SK Petroleum and Chemical Equipment (SZ:002278) Shanghai Aijian Securities·2025-12-22 05:57Investment Rating - The report assigns a "Buy" rating for the company, marking it as the first coverage [7][8]. Core Insights - The company is a key player in the research, development, manufacturing, and sales of equipment in China's oil and gas exploration, drilling, and refining sectors. It is expected to benefit from the deepening domestic replacement of marine engineering equipment and the expansion of AI-driven digital oilfield services overseas, leading to sustained improvement in profitability [7][8]. - The growth in China's oil and gas production is outpacing global rates, with a structural increase in demand for related equipment as development shifts towards marine and unconventional fields. The company is positioned to capitalize on this trend [7][8]. - The digital oilfield market is projected to grow significantly, providing opportunities for the company to expand its services internationally, particularly in the Middle East [7][8]. Financial Data and Profit Forecast - The company’s total revenue is projected to reach 859 million yuan in 2025, with a year-on-year growth rate of 17.1%. The net profit attributable to the parent company is expected to be 55 million yuan, reflecting an 81.5% increase [6][8]. - The company’s gross margin is forecasted to improve from 32.7% in 2023 to 38.9% in 2025, indicating a positive trend in profitability [6][8]. - The price-to-earnings (PE) ratio is expected to decrease from 75.7x in 2025 to 34.4x by 2027, suggesting a more attractive valuation as earnings grow [6][8]. Key Assumptions - The report assumes that capital expenditure in China's marine oil and gas development will increasingly focus on deepwater projects, with a significant portion of investment directed towards underwater production trees [9]. - The digital oilfield market in Kuwait is expected to expand, with the company projected to capture a growing share of this market, enhancing its revenue from digital services [9]. Market Position and Competitive Landscape - The company is recognized as one of the few suppliers in China capable of providing integrated equipment and services across the entire oil and gas industry chain, which positions it favorably against competitors [29]. - The competitive landscape in the oil service industry remains stable, with significant opportunities in emerging fields such as deepwater and unconventional oil and gas resources [7][8].