CNOOC Ltd

00883: XHKG (HKG)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	HK$43.50	Vjjn	Qnlfksfy

CNOOC Earnings: Robust Results Aided by Excellent Cost Control

Chokwai Lee

Apr 28, 2023

CNOOC's first-quarter 2023 net profit was above our expectation, down only 6% year on year to CNY 32.1 billion, despite weaker oil prices. We keep our fair value estimate at HKD 17.50 per H-share (CNY 15.30 per A-share) after incorporating our latest energy price and foreign exchange assumptions. CNOOC remains our top pick in the sector, and we believe the H-shares are undervalued, given its cost efficiency and oil and gas output growth. We think the company is on track to achieve its output target of 2 million barrels of oil equivalent per day by 2025, supported by new projects coming on stream and new discoveries in China and overseas.

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