COSCO HIPP (600026): Q4 freight rate will gradually rise to a new level during the boom cycle

COSCO HIPP (600026): Q4 freight rate will gradually rise to a new level during the boom cycle

南京夜网

Event: The company recently released 19H1 results: 71 realized revenue.

400 million US dollars, an annual growth of 39%; net profit attributable to mothers4.

6.9 billion US dollars, a significant loss in the past (the same period last year).

1.7 billion).

Investment points: The improvement of foreign trade oil transportation promoted the performance to reverse losses. The LNG business maintained a high growth rate of 19H1. The average daily TCE income of VLCC Middle East-Far East (TD3C) flights reached 20235 $ / day, at least +134.

5%, promoting foreign trade business to achieve 39 revenue.

8.6 billion, +55 per year.

25%, gross profit 4.

43 ppm, + 203% per year, with a gross profit margin of 22.

45%, +27 per year.

52pct; the company’s domestic trade business achieved gross profit 5.

64 ppm, the same as last 南宁桑拿 year, with a slightly higher gross profit margin, as the proportion of refined oil business increased; the company’s LNG transportation business achieved profit before tax2.

8.6 billion, +38 per year.

60%, the company has participated in the investment of 30.50 million cubic meters of LNG vessels, each time +8, and there are still 8 orders under construction.

The sulfur limit order and the US oil logic are gradually fulfilled. The freight rate in August exceeded expectations. Q4 is expected to reach a new level. The logic of the “three-year boom period of oil transport” mentioned in the report last year is gradually being fulfilled.

The freight rate of VLCCTD3C has exceeded $ 40,000 / day in August, which is the highest value since 2008. We expect the freight rate to reach a new level in the peak season of Q4.

Looking ahead, through the improvement of infrastructure, the export volume of crude oil such as the United States and Brazil will continue to increase; the installation of desulfurization towers brought by IMO 2020 will reduce the short-term industry supply, and the extremely low order ratio will inhibit the delivery of ships in the medium-term, thereby increasing supplyThe layout has been continuously improved in 2-3 years.

Earnings Forecasts and Estimates We raise our forecast for the average daily TCE rent of VLCC for 20-21 years to levels of 45,000 and 50,000 $ / day. It is estimated that the company’s net profit attributable to its mothers will be 10 in 19-21.

67, 42.

20, 54.

5.9 billion yuan, corresponding to 0 EPS.

27, 1.

05 and 1.

36 yuan / share, considering the effect of profit dilution after the issuance, a target price of 10 is given.

36 yuan, maintain the “recommended” level.

Risks suggest weaker macro economy leads to increased demand for crude oil, relaxation of U.S. sanctions on Iran causes Iranian fleet to return to the market