2024-03-30 16:00Investment Rating - The report maintains a "Buy" rating for COSCO Shipping Energy Transportation Co., Ltd. (600026) [2] Core Views - COSCO Shipping Energy reported a net profit attributable to shareholders of 3.35 billion yuan for 2023, a year-on-year increase of 130%, with a non-recurring net profit of 4.13 billion yuan, up 197% year-on-year [2] - The company plans to distribute a cash dividend of 1.67 billion yuan, resulting in a cash dividend payout ratio of 49.84% for the year [2] - The report highlights that the company's performance lags behind freight rates by about one month, with VLCC-TD3C average rates showing a decline of 6% from September [2] - The report notes that the increase in ship prices is driving up the company's replacement costs, providing a downward safety margin [2] - The oil transportation market is in a long-term upward cycle, with current freight rates remaining strong despite short-term fluctuations due to geopolitical factors [2] - The report maintains profit forecasts for 2024-2025 and introduces a new forecast for 2026, projecting a net profit of 9.2 billion yuan for 2026 [2] Financial Summary - Total revenue for 2023 was 22.09 billion yuan, with a year-on-year growth rate of 18.4% [3] - The net profit attributable to shareholders for 2023 was 3.35 billion yuan, with a projected net profit of 6.91 billion yuan for 2024 [3] - The report indicates an increase in gross margin from 29.9% in 2023 to 38.2% in 2024 [3] - The return on equity (ROE) is expected to rise from 9.7% in 2023 to 17.4% in 2024 [3] Market Data - As of March 29, 2024, the closing price of the stock was 16.83 yuan, with a market capitalization of 58.48 billion yuan [4] - The stock has a price-to-book ratio of 2.3 [4] - The stock's highest and lowest prices over the past year were 17.03 yuan and 10.75 yuan, respectively [4] Additional Insights - The report emphasizes the potential for improved performance in the first quarter of 2024 due to strong demand and geopolitical disruptions affecting freight rates [2] - The report also discusses the impact of new refinery capacities in China and increased oil production in the U.S. and South America on long-distance oil trade [2]