CLSA: Raises PETROCHINA (00857) target price to HK$12.4, maintains "Outperform" rating

CLSA issued a research report stating that PETROCHINA's (00857, 601857.SH) H-shares are mispriced by the market; the bank raised PETROCHINA's 2026-2028 earnings per share forecasts by 2% to 8%, and using SOTP valuation raised the H-share target price from HK$12 to HK$12.4 and the A-share target price from RMB15.9 to RMB16, maintaining an "Outperform" rating. The bank noted that the stock has been broadly range-bound over the past two months, but oil prices and PETROCHINA's A-shares rose about 25% and 19% respectively over the same period, with the A-H premium widening from 27% to 57% since September. Based on the bank's oil price assumptions, the H-shares currently trade at about 9x 2027 forecast price-to-earnings, with a dividend yield of about 6%. The bank noted that PETROCHINA's third-quarter net profit was RMB51.8 billion, up 22% year-on-year and down 7% quarter-on-quarter; first-nine-month net profit was RMB158 billion, already reaching about 89% of the bank's and the market's full-year forecasts. With oil prices remaining at elevated levels, the bank believes there is still upside to full-year consensus forecasts and dividend distributions. Earnings performance across the four major segments was solid, with both downstream refining and chemicals and marketing recording positive EBIT, in contrast to the downstream pressure at China Petroleum & Chemical Corporation (00386). The bank raised PETROCHINA's 2026-2028 earnings per share forecasts by 2% to 8%, and derived the above target prices using the SOTP valuation method.