BofA-COSCO Shipping Energy Transportation(H A)Stay Buy with crude tanker tailwinds building into 2H25-20250830

Lifting estimates, stay Buy after 1HG25 results

CSET 1H25 operating results were broadly in-line while the headline net income beatwas low quality on one-off gains. We lift our 2025-27 estimates to factor crude tankertailwinds from ramping OPEC+ production and tighter US sanctions. We stay Buy withCSET a key beneficiary of improving tanker markets with valuations at 0.8x PBV notpricing the healthy 2025-26 ROE outlook.

One-offs boost drives headline 1H25 beat

CSET 1H25 net income of RMB1.89bn beat BofAe at RMB1.64bn largely on one-offswith CSET reporting RMB0.25bn of disposal gains and subsidies. 1H25 operating incomewas broadly in-line with BofAe with better 2Q international unit revenues (+3% YoY)more than offset by softer 2Q domestic and international volumes (-9% YoY and -1%YoY respectively) and softer vessel chartering revenues.