UBS: Raises PETROCHINA (00857) target price to HK$13.3; first three quarters' net profit hits a new high for the same period.

UBS issued a research report stating that PETROCHINA (00857, 601857.SH) recorded a 7% and 22% year-on-year increase in revenue and net profit respectively for the first nine months, with net profit hitting a new historical high for the same period. The bank maintains its "Buy" rating and raised the target price from HK$12.8 to HK$13.3. The bank noted that PETROCHINA's first nine months' revenue and net profit reached RMB2.32 trillion and RMB155.8 billion, respectively; third-quarter net profit fell 7% quarter-on-quarter to RMB51.8 billion, in line with the bank's expectations. The bank pointed out that upstream oil and gas production rose quarter-on-quarter in the third quarter, but due to the quarter-on-quarter decline in oil prices, operating profit contracted 13% quarter-on-quarter to approximately RMB51.6 billion; refining and chemicals segment's third-quarter crude processing volume increased 11% quarter-on-quarter, with operating profit expanding 38% quarter-on-quarter, driven by improved refining margins; natural gas sales segment's third-quarter operating profit was approximately RMB9.2 billion, up 76% quarter-on-quarter. The bank remains positive on the company's operating trends and expects the upstream segment to continue benefiting from high oil prices. The bank forecasts Brent average prices of US$91.57 and US$80 for 2026 and 2027, respectively, and US$100 for the fourth quarter of 2026. The bank raised PETROCHINA's 2026 earnings forecast by 5% and slightly adjusted its 2027 and 2028 earnings forecasts; the new target price is based on sum-of-the-parts valuation, equivalent to 11x 2027 forecast price-to-earnings ratio.