UBS: Raise the target price of CNPC shares (00857) to 13.3. The net profit of the Hong Kong head of state for the third quarter reached a record high for the same period

The Zhitong Finance App learned that UBS released a research report saying that the revenue and net profit for the first nine months of CNPC (00857 and 601857.SH) increased 7% and 22% year-on-year respectively, and net profit reached a record high for the same period; the bank maintained a “buy” rating and raised the target price from HK$12.8 to HK$13.3.

According to the bank, CNPC's revenue and net profit for the first nine months reached 2.32 trillion yuan and 155.8 billion yuan respectively; net profit for the third quarter fell 7% quarterly to $51.8 billion, in line with the bank's forecast.

The bank pointed out that oil and gas production in the upstream business rose quarterly, but due to the quarterly decline in oil prices, operating profit was reduced by 13% to about 51.6 billion yuan; crude oil processing in the third quarter of the refining business increased 11% quarterly, and operating profit expanded 38% quarterly, driven by improvements in refining profits; and operating profit from natural gas sales in the third quarter was about 9.2 billion yuan, up 76% from quarter to quarter. The bank maintains an optimistic trend in the company's operations, and it is expected that upstream will continue to benefit from high oil prices.

The bank predicts that the average price of oil in 2026 and 2027 will be 91.57 US dollars and 80 US dollars, respectively, and 100 US dollars for the fourth quarter of 2026. The bank raised CNPC's profit forecast for 2026 by 5% and fine-tuned the 2027 and 2028 profit forecasts; the new target price is based on segmented aggregate valuation, which is equivalent to 11 times the projected price-earnings ratio in 2027.