Global oil drilling and production is active again, and the company's profits have bottomed out. As the number of active drilling rigs in the world has recently reached an all-time high, the oil drilling and production industry has come out of the trough of 09Q3~10Q2, and the company's quarterly gross profit margin has recovered from 14.76% of 09Q4 to 20.76% of 10Q3, and the industry is expected to gradually enter the business cycle.
Global demand for oil pipes is expected to double in the next five years. After 2000, the compound annual growth rate of global well completion is 7.56%, and the average well depth growth rate is 4.08%. With the decline of single well production in later mature oilfields and the gradual shift in the focus of global oil and gas exploration, we expect the global demand for oil well tubing to maintain a growth rate of about 12% in the next five years, reaching 22 million tons by 2015, double the demand in 2009.
The earthquake in Japan may play a positive role in the oil pipe market. From the demand side, the Fukushima nuclear leak will slow down the pace of global nuclear power construction, while wind power, solar power and other temporarily unable to make up for the gap, coupled with Japan's post-disaster reconstruction, short-term petrochemical energy demand will further increase; from the supply side, Japan accounts for about 12% of the world's high-end oil pipe production capacity, short-term high-end market supply will be greatly affected.
The R & D capability of high-end products is outstanding, and the gross profit of the products increases steadily. High-end casing will be the future development direction, and the global demand for high-end oil well pipes is expected to reach about 13 million tons in 2015. We judge that the comprehensive gross margin of high-end products will be higher than 100,200 yuan / ton. at present, the company's high-end product research and development capability is in the leading level in China, and the high anti-collapse casing and special diameter casing for complex geological conditions have been fully introduced to the market. with the release of 300000 tons of production capacity in 2012, the company's product gross margin is expected to increase steadily in the future.
Domestic and overseas markets jointly promote the growth of the company's performance. At present, the company's three major oil orders are about 90,000 tons, and the demand for natural gas and coalbed methane will become another growth point in the company; overseas will focus on the high-end markets in North America and oil-producing regions such as the Middle East, Africa and South America. Overseas market sales are expected to exceed 200000 tons in 2011.
The "overweight" rating is given for the first time. We estimate that the company's EPS from 2011 to 2013 will be 1.01,1.33 and 1.56 yuan respectively, with a compound annual growth rate of 31%. The company will be given a 30-fold PE in 2011, with a target price of 30.3 yuan, and a "overweight" rating for the first time.
