Glonghui, April 29 | J.P. Morgan Chase released a report stating that Sinopec's net profit for the first quarter fell 10% year-on-year to 18.7 billion yuan, reaching 28% of the market's profit forecast for the full year, and significantly higher than Motong's estimate of 16 billion yuan, mainly due to growth in exploration, mining and oil marketing business. It is estimated that investors will focus on domestic refining and oil marketing prospects, dividend policies, domestic chemical and new energy mergers and acquisitions opportunities, and net profit trends for the second quarter after inventory increases. Motong pointed out that exploration and mining, refining and oil marketing performance in the first quarter was better than feared. I believe it was mainly due to Sinopec's operational optimization measures for domestic refineries, including shutting down loss-making facilities and increasing market share. Motong predicts that refining profit margins will recover in the medium to long term. It favors Sinopec's H shares over A shares. Because H shares have a high return on dividends, it gives H shares an “increase in holdings” rating. The target price is HK$5.5.