Domestic liquefied natural gas concentration rise, gas sector valuation repair
The domestic liquefied natural gas priceshave been continuously rising this week. The recent surge in imported gasprices has stimulated the rise of domestic gas prices, coupled with favorablesupport from the supply and demand sides, leading to a concentrated upwardtrend in domestic liquefied natural gas prices.
Asian liquefied natural gas prices havejumped to their highest level since early January, due to concerns thatIsrael's response to last weekend's attack on Iran may escalate into a broaderconflict.
On Tuesday, the spot liquefied natural gasprice in North Asia exceeded $11 per million British thermal units, and hasrisen by about 40% since the end of February. Prior to this, Europe, which wascompeting with Asia for liquefied natural gas, also experienced similar growth.
The National Development and ReformCommission of China has issued a new policy on natural gas pipelinetransportation fees, simplifying the pricing mechanism and promoting theefficiency improvement of pipeline operation enterprises; Over the past 23years, the mechanism of preferential pricing for residential use has beenintensively implemented in various regions, actively addressing the phenomenonof gas price inversion. The market-oriented reform of natural gas is beingcarried out in an orderly manner.
Natural gas related enterprises:
New Austrian Energy (02688): The currentfocus of growth has shifted to non LNG trading business. Among them, therevenue of the Pan Energy business increased by 32.5% to 14.513 billion yuan,accounting for 13.2% of the company's total gross profit. The "Pan EnergyMicrogrid" model launched has achieved the integration of load, source,network, and storage, involving multiple fields such as clean energy,distributed energy storage, and intelligent services; Zhijia's business revenuewas 3.702 billion yuan, an increase of 18.9% year-on-year, with a gross profitof 2.517 billion yuan, an increase of 21.1% year-on-year, and the cost sideshowed an improvement trend. Thanks to the accumulation of high stickiness andexisting customer groups in the main business of urban combustion, thepenetration rate is expected to continue to increase in the future.
Kunlun Energy (00135): As of June 30, 2023,89.2% of the company's upstream LPG resources come from its major shareholder,PetroChina. The company's main sources of revenue are natural gas sales(accounting for about 80%) and LPG sales. Although there are also LNGprocessing and storage, exploration and production businesses, the formercurrently has two receiving stations in Tangshan and Jiangsu, while the latterexplores and extracts crude oil and natural gas in the Republic of Kazakhstan,the Sultanate of Oman, and other places. However, the revenue scale of both isstill small.
China Resources Gas (01193): CICC believesthat last year's performance was lower than market expectations. The managementhas guided an annual increase of 6-8% in gas sales this year, with a grossmargin of over 0.52 yuan per cubic meter. Considering that the company's gasprojects in cities such as Chengdu/Fuzhou have recently obtained residentialprice adjustment documents, LNG spot prices remain at a relatively low level.It is believed that the company's gross margin repair situation may exceed themanagement's guidance.
Beijing Holdings (00392): In 2023,Beikong's operating revenue was 82.31 billion yuan, of which Beijing Gas'soperating revenue was 61.47 billion yuan, a year-on-year increase of 2.7%,accounting for 74.7% of the total operating revenue. But within the year, theprofit margin decreased by nearly 11% to 4.563 billion yuan. Beijing Gas'scombined natural gas sales volume in 2023 is 24 billion cubic meters. Amongthem, due to factors such as early heating, the sales volume of pipeline gas inBeijing increased by 1.7% year-on-year to 18.1 billion cubic meters. The gassales volume in the outer city is 2 billion cubic meters, LNG distribution is2.3 billion cubic meters, and LNG international trade is 1.6 billion cubicmeters