This report is read as follows:
It is announced that the controlling shareholders will increase their holdings of the total share capital by 1%, which shows that the major shareholders are optimistic about the future development prospects of the company; they plan to increase their capital by 137 million yuan in the United States, and the upward trend of substantial improvement in performance has been established and increased.
Main points of investment:
Conclusion: Mr. Dong Dou Jianwen, the public controlling stock, bought and increased his holdings of 3.848 million shares through block trading and bidding in the secondary market, accounting for 1% of the total share capital of the company, which shows that the major shareholders are optimistic about the future development prospects of the company and the long-term confidence of the domestic capital market. There is still a lot of room for the existing stock price, and it does not rule out further increase in the future. OPEC production reduction helps international oil prices fluctuate upward, the company plans to increase investment in the United States of Hammer by 137 million yuan, increase investment in overseas unconventional oil and gas exploration, which is conducive to significantly thickening performance, is one of the targets that benefit most directly from the rise in oil prices and the largest performance flexibility, and maintain the EPS of 0.11 ppm 0.25x0.37 yuan unchanged from 2016 to 2018, maintain the target price of 20 yuan unchanged, and maintain the overweight rating.
Substantial increase in holdings by major shareholders shows confidence in long-term development, and further increase in holdings in the future cannot be ruled out. The company announced that the controlling shareholders bought 542000 shares through block trading (buying 3.306 million shares of the company's employee shareholding plan) and bidding in the secondary market, increasing their total holdings by 1.00% to 17.86%. Against the backdrop of a sharp decline in gem stocks, the massive increase in holdings against the trend highlights the confidence of major shareholders in the future development of the company. It is judged that a series of capital operations of the company in recent years (entering North American oil and gas exploration, acquisition of Qinghe Machinery, layout of oil field environmental protection, equity participation in CNNC Jiahua and Stan Instruments) will enter the performance harvest period, and the upward trend of substantial improvement has been established.
It is proposed to increase the capital of Hammer by 137 million yuan in the United States, and the rise in oil prices will benefit one of the most direct and flexible targets. The company currently owns the Niobrara joint development zone (10% of Haimo equity) in North America and the independent development block of Permian Basin, which produces about 1 million barrels of equivalent oil and gas per year, while the latter has an annual production capacity of about 20,000 barrels (about 70 barrels per well per day, which is planned to increase from 3 wells at the beginning of the year to 10 wells in 2017). Performance is very flexible due to the rise in oil prices and the substantial increase in stock wells.
Risk hint: international oil prices have fallen sharply, and the performance of participating companies has fallen short of expectations.