PetroChina Co Ltd Class H

00857: XHKG (HKG)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	HK$1.30	Ggrpd	Csxsfgz

PetroChina Strong Upstream Earnings in Q3 2022 Partly Offset by Weaker Downstream Contributions

Chokwai Lee

Oct 28, 2022

PetroChina’s cumulative nine months' 2022 net profit was CNY 120.3 billion, up 60.1% year on year and beats FactSet's consensus estimate, likely due to robust earnings from the upstream segment. We keep PetroChina’s fair value estimate at HKD 4.92 per H-share (CNY 4.28 per A-share), after updating our energy price and foreign exchange assumptions. We think PetroChina’s H-shares are undervalued, but we prefer CNOOC as our top pick in the sector given its upstream focus (a direct beneficiary of higher oil prices) and attractive risk/reward.

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