Main points of investment:
The design of master package in large-scale sulfur recovery unit in refinery has a strong competitive advantage.
By the end of June 2016, more than 30 large-scale sulfur recovery units have been designed or contracted by the company, nearly half of which are super-large sulfur recovery units with a single series of more than 100,000 tons per year, with a total sulfur treatment capacity of more than 2 million tons per year. The ZHSR domestic large-scale sulfur recovery technology independently developed by the company has a sulfur recovery rate of more than 99.98%, reaching the international advanced level.
The refining and chemical industry has entered a new capacity investment cycle, and private enterprises have brought new vitality after their entry.
Since 2016, the profit of China's oil refining industry has reached 170 billion, and the profit of the petrochemical industry has also reached an all-time high, and relevant companies have the willingness and ability to invest in new devices. At the same time, as China has opened up access to the private oil refining industry in the past two years, it has promoted powerful private enterprises to enter the oil refining industry, mainly in two parts: the former Shandong Refining and the private polyester filament and PTA enterprises for the acquisition of PX raw materials.
It is estimated that the total investment in the refining and chemical industry will be close to 800 billion during the 13th five-year Plan period, and the company will benefit significantly.
China Petroleum & Chemical plans to invest 200 billion yuan to optimize and upgrade four world-class refining and chemical bases, namely, Maozhan, Zhenhai, Shanghai and Nanjing. At the same time, Petrochina Company Limited, Arms Group, Sinochem and Sinochem also began to gradually increase investment. It is estimated that during the 13th five-year Plan period, the total investment in the whole refining and chemical industry will be close to 800 billion yuan, the investment in refining and chemical plants will increase, and the engineering companies will benefit. Zhenhai shares are expected to fully benefit from its own R & D and location advantages.
The company also has strong strength in other fields of refining and chemical engineering, and is looking forward to horizontal breakthroughs.
The company, formerly known as the design institute and materials department of Zhenhai Refining and Chemical Industry, grew up with China's top refining and chemical enterprises. Designed and jointly contracted Zhenhai National crude Oil Reserve Base, China's first national strategic crude oil reserve base, and designed and jointly contracted a single atmospheric and vacuum distillation unit with the largest processing capacity in China-- CNOOC Huizhou 1200 million tons / year atmospheric and vacuum distillation unit. The company has undertaken or participated in the construction of sulfur recovery units, hydrogenation units, atmospheric and vacuum distillation units, delayed coking units and other key units in the petrochemical industry, totaling more than 100 sets, more than 40 sets of oil storage and transportation systems, and completed plant design. Customers are widely distributed in many provinces, cities and regions throughout the country.
Investment advice: benefit from the access of private enterprises, as well as the trend of large plant refining and chemical industry. The company is expected to make profits of 51 million, 72 million, 145 million and 280 million respectively from 2016 to 2019, giving it a "recommended" rating.
The main risk factors: the progress of industrial investment is not as expected, and the landing of the company's order is not as expected.