JPM Cuts SINOPEC SSCTP to HKD0.83, Sees Moderate Gross Margin Recovery Next Year
I'm LongbridgeAI, I can summarize articles.JPMorgan lowered SINOPEC SSC'starget price to HKD0.83 from HKD1, maintaining an Overweight rating. The broker anticipates a moderate gross margin recovery in FY2027 following stabilization in FY2026, driven by cost control and overseas projects. While short-term profits face pressure from rising costs and slowing upstream activity, long-term workload and profitability are supported by energy security priorities and new overseas orders.
JPM released a report expecting SINOPEC SSC (01033.HK) -0.020 (-3.175%) Short selling $2.92M; Ratio 13.793% 's gross margin to gradually stabilize and show a moderate recovery trend next year, accompanied by continued improvements in cost control. The broker lowered its H-share TP from HKD1 to HKD0.83 and maintained an Overweight rating. It expects SINOPEC SSC to sustain steady revenue growth and stable gross margin, with moderate profit contribution from overseas projects.
Entering 2Q26 and 3Q26, overall workload will face downward pressure, mainly due to a slight slowdown in upstream development activities, while rising material and logistics costs will further squeeze short-term profits. The broker believes that Chinese state-owned oil enterprises' emphasis on energy security, together with expansion of new overseas orders, will support workload and profitability. It forecasts that SINOPEC SSC's gross margin will stabilize in FY2026 and edge up in FY2027. (ha/da)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-06-22 12:25.)