CICC forecasts PetroChina's Singaporean purchase to bring RMB300mln in profit

CICC forecasts that PetroChina’s (PTR.NYSE; 0857.HK; 601857.SH) purchase of Singapore Petroleum Company will bring 300 million yuan in profit to the Chinese oil firm. PetroChina said on Sunday that its subsidiary PetroChina International (Singapore) Pte. Ltd. has completed the purchase of a 45.51 percent stake in Singapore Petroleum Company. CICC analyst Zhang Tao reckons that PetroChina’s purchase price of 6.25 Singapore dollars is worthwhile, since the price is about 14 times, 18.4 times and 14.6 times the EPS of the Singaporean company from 2008-2010, respectively. Further, its gasoline and diesel return ratio was only 42 percent, far lower than PetroChina’s 79 percent. Goldman Sachs forecasts that the Singaporean refining industry will encounter difficulties when trying to profit over the following quarters, though no explanation was made. By the end of 2008, Singapore Petroleum Company owned total assets worth of 3.4 billion Singapore dollars, or 116 billion yuan, including net assets of 1.7 billion Singapore dollars, or eight billion yuan. In 2008, the company earned sales revenue of 11.1 billion Singapore dollars, or 52.4 billion yuan, with net profit of 230 million Singapore dollars, or 1.1 billion yuan. (June 22, 2009)