China Offshore Oil Stock Hits Record High: Who Benefited?
Funds heavily invested in China National Offshore Oil Corporation (CNOOC) are entering a period of harvest. CNOOC's A-shares and H-shares surged on March 4th, with the A-shares reaching a new high since their listing. The significant increase in stock prices has also brought substantial gains for fund managers such as Zhang Kun from Yifangda, Zhou Haidong from Hua Shang Fund, and Tan Li from Harvest Fund, who manage billions of dollars in assets.
CNOOC's stock price, which has always been lukewarm, has set a new record high since its listing.
On March 4th, CNOOC's A-shares and H-shares closed up by 7.32% and 3.34%, respectively, with the A-shares hitting an all-time high.
Over the past two years, CNOOC's A-shares and H-shares have performed exceptionally well in the secondary market, even outperforming China National Petroleum Corporation (CNPC) and China Petrochemical Corporation (Sinopec).
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This has also allowed funds that had positioned themselves in advance to reap substantial benefits.
As of last year's third quarter, Guoxin Investment and social security funds held 257 million and 70.3943 million shares, respectively. If they did not reduce their holdings from the end of September last year to the present, Guoxin Investment and social security funds have made significant profits.
In addition, among public funds, star fund managers such as Zhang Kun from Yifangda, Zhou Haidong from Hua Shang Fund, and Tan Li from Harvest Fund also hold substantial positions in CNOOC. With the continuous rise of CNOOC's stock price, these fund managers have reaped substantial rewards.
The driving force behind CNOOC's explosive growth is a combination of strong operational performance, high dividend payout ratios, and increased valuations.
CNOOC's stock price hits a historical high
"Is this too aggressive?!" exclaimed one investor on a related platform, marveling at the relentless rise of CNOOC's stock price.On March 4th, China National Offshore Oil Corporation (CNOOC)'s A-shares and H-shares both saw significant increases, with the A-shares reaching a record high since their listing.
Rome wasn't built in a day. Over the past two years, the overall stock market performance has been lackluster, yet CNOOC's stock price has been gradually climbing. Data from Choice shows that the price change of its A-shares from the listing in April 2022 to the current date is 166% (on a rights-adjusted basis). The H-shares have seen a price change of 230% since 2022.
As its stock price soared, it also attracted a considerable amount of capital. For instance, Guoxin Investment, a subsidiary of Guoxin Group, significantly increased its holdings in CNOOC's A-shares during the second and third quarters of last year.
Specifically, Guoxin Investment's holdings in CNOOC had increased to 250 million shares by the end of June last year, up from 139 million shares in the previous quarter. By the third quarter, Guoxin Investment further increased its holdings by 7.1971 million shares to 257 million shares. If Guoxin Investment did not reduce its holdings from the end of September last year to the present, and based on the closing price on March 4th, the holding value is approximately 6.9 billion yuan.
The Social Security Fund also entered CNOOC's top ten circulating shareholders last year in the third quarter, holding 70.3943 million shares. If it did not reduce its holdings from the end of September last year to the present, and based on today's closing price of 26.97 yuan per share, the holding value is 1.899 billion yuan.
Public funds, as sensitive as the "smell" of the national team, also showed interest.
The relevant data shows that by the end of March 2023, CNOOC's A-shares appeared in the top ten heavy stocks of 113 funds, holding a total of 189 million shares, with a holding value of 3.212 billion yuan, making it the 190th largest stock in public funds (sorted by holding value).
In the same year's third quarter, public funds doubled their bets on CNOOC. The data shows that as of the end of September last year, CNOOC appeared in the top ten heavy stocks of 221 funds, holding a total of 300 million shares, with a holding value of 6.337 billion yuan, making it the 84th largest stock in public funds (sorted by holding value).
By the fourth quarter of 2023, CNOOC's H-shares were even more eagerly included in the investment baskets of public funds. The data shows that by the end of last year, among the heavily held H-share companies, public funds held CNOOC with a value of 15.09 billion yuan, second only to Tencent's over 30 billion yuan. This means that it has left behind other heavily held stocks such as China Mobile, Meituan, Kuaishou, and WuXi Biologics.
Which star fund managers were "lying in wait" in advance?Under the premise of an unideal equity market, the foresight to "bet on" China National Offshore Oil Corporation (CNOOC) has allowed many star fund managers to hold their heads high.
Among them, Zhang Kun from Yifangda has been closely following CNOOC since 2023, with a significant amount of holdings.
According to Tiantian Fund Network, Zhang Kun currently manages a total of 4 funds. Among them, three funds, namely Yifangda High-Quality Enterprise Three-Year Holding Period Mixed, Yifangda Blue Chip Selection Mixed, and Yifangda Asia Selection Stock, hold significant positions in CNOOC. As of the fourth quarter of last year, the number of shares held in CNOOC Hong Kong stocks by these three funds were 35 million, 282 million, and 28 million, respectively. The holding ratios were 8.4%, 7.96%, and 7.86%, with the holding market values being 410 million yuan, 3.322 billion yuan, and 330 million yuan, respectively.
As early as the first quarter of last year, Zhang Kun had set his sights on CNOOC, but the overall number of shares held was slightly reduced each quarter. The number of shares held by Yifangda High-Quality Enterprise Three-Year Holding Period Mixed in the first three quarters were 45.3 million, 45 million, and 36 million, respectively. Yifangda Asia Selection Stock followed suit, reducing its holdings in the first three quarters. Yifangda Blue Chip Selection Mixed reduced its holdings from 305 million shares in the third quarter to 282 million shares.
Like Yifangda's Zhang Kun, Zhou Haidong, the "mainstay" of HuaShang Fund, also holds a significant position in CNOOC Hong Kong stocks.
Currently, Zhou Haidong manages a scale of 34.1 billion yuan and 6 funds. Among them, HuaShang Xinxuan Return One-Year Holding Mixed, HuaShang Zhenxuan Return Mixed, and HuaShang Hengyi Stable Mixed all have CNOOC in their top ten holdings, with holding ratios of 2.36%, 4.08%, and 2.41%, respectively. The listed company is the largest holding in the latter two funds.
As of the end of December last year, the number of shares held by the three funds were 2.303 million, 30.4911 million, and 2.6395 million, respectively, with holding market values of 27.1313 million yuan, 359 million yuan, and 31.0958 million yuan.
Tan Li, known as the "value sister" from Harvest Fund, is also a loyal follower of CNOOC.
Currently, Tan Li manages 8 funds, among which 5 funds, namely Harvest Value Creation Three-Year Holding Period Mixed, Harvest Value Driven One-Year Holding Period Mixed, Harvest Value Selection Mixed, Harvest Value Evergreen Mixed, and Harvest Value Selected Stocks, hold significant positions in CNOOC Hong Kong stocks. The number of shares held are 1.821 million, 16.543 million, 10.124 million, 15.618 million, and 22.272 million, respectively; the holding market values are 21.4529 million yuan, 190 million yuan, 120 million yuan, 180 million yuan, and 260 million yuan, respectively.
In addition, Jiao Wei, a billion-yuan fund manager from Yinhua, and Dong Han, a 30 billion-yuan fund manager from JingShun Great Wall, also place CNOOC Hong Kong stocks among the top ten holdings of multiple funds.Behind the Soaring China National Offshore Oil Corporation (CNOOC)
The substantial returns for major shareholders are driven by CNOOC's excellent operational performance, low valuation, and high dividend payout ratio.
Looking at CNOOC's business, it is focused on offshore oil exploration, development, and production, with oil and gas sales accounting for 78.98%, a higher proportion compared to the other "two barrels of oil."
Currently, the world has entered an "era of oil and gas resource scarcity." In a research report last year, Guojin Securities pointed out that U.S. shale oil production may be approaching its peak, but the willingness of oil and gas companies to develop is still low, and they are more inclined to distribute profits as dividends, leading to a continued tight supply; on the other hand, with the recovery of demand, there is a possibility of marginal increase in global oil demand.
Against this backdrop, CNOOC, which is dedicated to oil and gas extraction, increased its net oil and gas production to 623.8 million barrels of oil equivalent in 2022, setting a new record for the company's net production.
With both volume and price rising, CNOOC's performance has also soared. From 2021 to the end of September 2023, the company's revenue was 246.111 billion yuan, 422.23 billion yuan, and 306.817 billion yuan, respectively, with corresponding net profits attributable to the mother company of 70.32 billion yuan, 141.7 billion yuan, and 97.645 billion yuan.
In addition, CNOOC also expects that the net production target for 2024 will be 700-720 million barrels of oil, an increase of 7.69%-9% compared to the 2023 target. From 2025 to 2026, it is expected that the net production will increase by an average of 55 million barrels per year.
This undoubtedly gives a reassuring pill to a large number of followers.
At the same time, CNOOC is also very generous in dividends. Data shows that after listing, CNOOC has cumulatively paid out 134.847 billion yuan in dividends, including 8.471 billion yuan in A-shares and 126.376 billion yuan in H-shares. The current dividend payout ratio is 4.85%, and the dividend payout ratio is 43.15%.
In addition to dividends, CNOOC's valuation is also underestimated, with both the static and dynamic price-to-earnings ratios of A-shares being less than 10 times. Under the condition of undervaluation and high dividend yield, capital naturally flocks to it, and the stock price reaching a new high is also a natural result.