According to a research report published by Bank of America Securities, CNOOC Services' profit for the first quarter of fiscal year 2024 increased 57% year-on-year, better than the bank and market expectations, higher than the bank's and market consensus; first-quarter revenue increased 20% year-on-year; and operating profit margin was 12%, up from 10% in the first quarter and fourth quarter of last year. The bank noticed that although the utilization rate of CNOOC's drilling rigs remained flat year over year, the company's performance recorded an improvement. Mainly due to a rebound in oil well service profit margins, the bank therefore expects the company's revenue to increase by 20% to 30% year-on-year in the 2024 fiscal year. The bank also quoted that CNOOC's management is positive about its oilfield service revenue growth and expects continued investment in R&D to benefit the company's profit margin performance. However, management also anticipates that in the next 3 to 5 years, overseas revenue will increase or put pressure on the company's profit margins. Bank of America Securities also indicated that CNOOC's four jack-up drilling platforms in Saudi Arabia will be suspended from the second quarter of this year. The shutdown period will last for 12 months without any compensation. At that time, the company will only continue to operate about 2 to 3 drilling platforms locally, and management also anticipated that the company's profit could be reduced by about 400 million yuan as a result. The bank said it remains cautious about the long-term negative effects of CNOOC Services and decided to set its target price for H shares at HK$9.3 to maintain the “outperforming market” rating.