Lyon: Raise the target price of CNPC shares (00857) to HK$12.4 to maintain a “outperforming the market” rating

The Zhitong Finance App learned that Lyon released a research report saying that CNPC (00857, 601857.SH) H shares were mispriced by the market; the bank raised CNPC's 2026-2028 earnings forecast by 2% to 8%, and raised the target price of H shares from HK$12 to HK$12.4 using SOTP valuation, and raised the target price of A-shares from RMB 15.9 to RMB 16, maintaining a “outperforming the market” rating.

According to the bank, the stock has been generally rampant in the past two months, but oil prices and CNPC A shares rose by about 25% and 19% respectively during the same period, and the A-H premium widened from 27% to 57% since September. Based on the bank's oil price assumption, H shares are currently trading at about 9 times the predicted price-earnings ratio in 2027, with a dividend rate of about 6%.

According to the bank, CNPC's net profit for the third quarter was RMB 51.8 billion, up 22% year on year and down 7% from quarter to quarter; net profit for the first nine months was RMB 158 billion, which reached about 89% of the bank's and market forecasts for the full year. While oil prices remain high, the bank believes that there is still room for improvement in consensus forecasts and dividend payments throughout the year. The profit performance of the four major divisions was steady. Downstream refining and sales all recorded positive EBIT, in contrast to the downstream pressure of Sinopec (00386).

The bank raised CNPC's 2026-2028 earnings forecast per share by 2% to 8%, and used the SOTP valuation method to calculate the above target price.