HSBC: Downgrade CNOOC (00883 HK) to "Reduce" with a reduced target price of HK$13.5

According to the Intelligence Finance App, Morgan Stanley released a research report stating that in the first quarter of fiscal year 2025, China National Offshore Oil Corporation (CNOOC) (00883) saw a year-on-year decline of 8% in net profit, accounting for 27% of the market's forecasted annual net profit. The company's performance was affected by a 1% increase in the average selling price of natural gas and a 5% increase in production, which did not fully offset the impact of an 8% year-on-year decline in oil prices. The bank stated that although it has been optimistic about Chinese oil companies since 2020, it downgraded oil assets in the fourth quarter of last year and took a cautious stance on spot liquefied natural gas in February of this year. After CNOOC released its financial report, the bank lowered its earnings per share forecast for fiscal year 2026 by 21% to reflect Brent crude oil prices, and strategically downgraded its rating from "buy" to "hold", and lowered the target price from 22 Hong Kong dollars to 13.5 Hong Kong dollars.