China’s first quarter decrease of 23.924 billion yuan perfecting commerce, petrochemical commerce since 2001, the first down turn in earnings
The chemical industry is a larger proportion of the stock market in China, China Petroleum (601857) (601857.sh) and Sinopec (600028) (600028.sh) is a big heavyweight. First quarter of this year, the chemical industry in the petrochemical and chemical industry based on two sub-sectors due to the continuing rise in international oil prices caused by the impact of slower growth. China Petroleum and Chemical Industry Association’s data show that China’s oil refining industry in the first quarter loss of 23.924 billion yuan, the petrochemical industry since 2001, the first decline in profits. At the same time, crude oil prices despite the promotion of chemical products based on price, but still arrived but the arrival of down-cycle. Rising costs of crude oil is the “culprit”
The chemical commerce is highly cyclical, in the past couple of years, China’s fast financial development, fast development rate of repaired buying into, so the expansion of the chemical commerce and the development rate of earnings is very gratifying. However, ecological defence, as well as putting force on raw components increased step-by-step, simultaneously with the international influence of China’s macro-economic slowdown. Thus, the expansion conveyed about by expanded expending, the boost in financing charges, merchandise whole margin down turn and slowdown in sales and other components may lead to expansion of the chemical commerce begun to go in a cyclical down high ground trend.
Orient Securities oil and chemical development, said Wang Jing, head analyst in the long run, the petrochemical development into a recession will not be so soon. Because, in spite of high oil costs, but the worse arrives at of the development demand for oil weighed against wang. “China is the world’s third-largest oil dealing nation, and ensnare up with Japan’s movement of second place. The carrying on get higher in global crude oil costs, the charges for imported crude oil advanced, oil enhancing enterprise deficits, effecting in industry-wide yield decline. ”
GF Securities chemical industry researcher Wei-Dong Li said that the refining industry a huge loss, but the agricultural chemical and inorganic chemical in the soda ash industry is thriving. This year, in international product prices of raw materials prices and prices of agricultural products and other factors, agricultural product prices continue to rise. In addition, due to the lower reaches of the demand growth rate faster than productivity, resulting in soda ash prices.
Sinopec came arduous shrinking yield
The chemical industry’s primary financial gatherings are the two heavyweight China Petroleum and Sinopec. “From these two stages of the company’s enterprise, its upstream and downstream development flexible chain of bonds is without bias whole, but the with accent on on the higher arrives at of the China National Petroleum oil and gas exploitation, and the with accent on on the worse arrives at of China’s petrochemical enhancing industry. Therefore, the divergence from a enterprise purpose of scenery China’s Sinopec by high global oil costs, as well as the in the household enhanced oil charge controls a bigger impact. ” Jing said.
As a outcome of the proceeded worsening of the present inflationary stresses, China’s perfected oil charges and worldwide charges of the occurrence of inversion will be continued. Sinopec quarterly released this year displayed that the bigger the influenced its presentation, its rudimentary profits per share 0.077 yuan, snare assets yield 2.13 per hundred, 332 billion yuan of enterprise revenue. Judging from the snare earnings, 6.7 billion the first quarter of 65.78 per hundred year-on-year. And in detail as high as 7.4 billion in government grants, the business lost 700 million yuan.
Recently, the Ministry of Finance handed out supportive principles, encompassing grants for trades of crude oil processed and perfected oil trades of value-added levy refund policy. Jing said that Sinopec is China’s biggest oil perfecting enterprise, about 70% of the buy of crude oil from the worldwide community. Subsidies and the function of levy rebates is very restricted, confined to command fluctuations in their presentation, and any try to halt the down high ground trend.
Agricultural chemistry and chemical-based soda ash highlights
In the minimal chemical development, said Wei Dong Li, as the ethylene cracker expansion of the economic procedure supported on degree of petrochemical yield in the ceaseless descent in distributes carry on to narrow.
And downstream chemical financial gatherings, tdi, mdi (both for the goods produced of polyurethane raw materials) and the organic silicon development has moved into a interval of quick expansion, the charge is unwavering at present, not more radiant spots. However, the complete chemical development supported on the case of a flat, Dong Li-wei and soda that the growers will become the foundation for a greater room for the development of chemical development this year, the two sub-sectors. “Agriculture and the costs of soda ash will be more extensive advance in these two sub-industry profitability.”
Mdi goods as a outcome of expanding the groundwork in order that steady development presentation, Dong Li-wei suggested Yantai Wanhua anxiety (600309) (600309.sh). The accomplishment of the company’s 2007 incomes 7.804 billion yuan, an boost of 55.77%, snare earnings of 1.481 billion yuan, up 71.56 per share earnings of 0.89 yuan, with higher growth. Its sales come to 40.39 per hundred whole margin than the 2006 rate of 35.75% certain to increase. Mdi household charges as a outcome of important rises, mdi Product whole margin there has been a important pick-up, so to live at the household mdi sales 1 / 3 market share in Yantai Wanhua, its earnings margins will be a somewhat large boost imagination.
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