Essence International initiated coverage on Beijing Gas Blue Sky with a “Buy” rating

Target price set at HK$0.75

HONG KONG, CHINA – Media OutReach – 24 April 2017 – Essence International’s report firstly granted Beijing Gas Blue Sky Holdings Limited (“the Company” or “Beijing Gas Blue Sky”, together with its subsidiaries, the “Group”, HKSE: 6828) to a “Buy” rating with target price HK$0.75.

 

Essence International’s report pointed out that, in 2016, Beijing Gas Blue Sky’ gas sales volume amounted to 284 million m3, representing a y-o-y increase of 15 times; while total revenue amounted to HK$634 million, representing a y-o-y increase of 499%; net profit grew 482% y-o-y to HK$99.89 million, which reflects the rapid growth of the business. With the rise of oil price and the drop of gas price, as well as the growth of downstream industries’ need of natural gas, Essence International expects Beijing Gas Blue Sky will record a total gas trading volume of 650 million m3 by 2017, and will become one of the Top 5 domestic LNG (Liquified natural gas) trading companies in the PRC.

 

Also, Beijing Gas Blue Sky has been included as a constituent of Hang Seng Composite SmallCap Index in March this year. The average monthly market capitalisation of the Company from July 2016 to March 2017 was about HK$5.29 billion which fulfills the inclusion condition in the Shenzhen-Hong Kong Stock Connect (SZ-HK Stock Connect). Essence expects the Company would have a high opportunity to be included in SZ-HK Stock Connect in August


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