HK Stock Market Move | KUNLUN ENERGY (00135) falls by more than 4% again. Warm winter may affect natural gas demand. Citigroup expects management to provide conservative sales guidance for this year.

KUNLUN ENERGY(00135) fell more than 4% again, falling 3.86% to HK$7.47 as of the time of publication, with a turnover of HK$95.3445 million. BOCOM INTL released a research report stating that due to warmer winter weather starting in the fourth quarter of 2024, natural gas demand in the mainland saw a year-on-year decline in November 2024. The bank also lowered the company's industrial, commercial, and residential gas consumption forecast. The company's gas station business is set to be reorganized with its parent company in 2024, and the bank estimates that the company will still have around 500 million cubic meters of sales from gas stations in the second half of 2024. The bank estimates that the company's retail gas sales will increase by 8.6% year-on-year in 2024. Citigroup stated that the lower growth rate of KUNLUN ENERGY's retail gas sales and the decrease in utilization of liquefied natural gas (LNG) receiving stations, coupled with the increase in USD profit margin due to the decrease in unit cost of retail gas sales, could not offset each other. As a result, the bank lowered the group's net profit forecasts for 2024, 2025, and 2026 by 2%, 4.6%, and 4.9%, respectively. In addition, Citigroup believes that Chinese gas distributors will provide conservative guidance on retail gas sales growth for this year during the March financial reporting season.