2016 All-Asia Research Team: Oil & Gas, No. 1: Hanzhi Ding, Kyung (Sonia) Song & team

Hanzhi Ding,
Kyung (Sonia) Song & tea

Bank of America
Merrill Lynch

First-Place Appearances: 4

Total Appearances: 15

Team Debut: 2000

In its 15th appearance on this roster, Bank of America Merrill Lynch climbs from second place to reclaim the No. 1 position it earned in 2014. Working out of Hong Kong,Hanzhi DingandKyung (Sonia) Songoversee coverage of 13 regional oil and gas names. “We are positive on the beneficiaries of lower oil prices and expect companies with high exposure to midstream and downstream to benefit,” reports Ding. “Meanwhile, company restructuring is likely to restore balance-sheet strength and improve defensiveness against the low oil price.” The researchers are more cautious on the sector overall, however. “We expect oil’s volatility to remain high throughout the year until a year-end oil price recovery takes place,” Song says. “China oils will likely face an adverse [exploration and production] operating environment and reform pressure from the government.” Since November the team has been advising investors to buy Sinopec Engineering (Group) Co. — one of the world’s largest oil refining and chemical engineering, procurement and construction companies — citing the Chinese state-owned enterprise’s home-market strength and continual overseas expansion. As of late last month, the stock had advanced 12.9 percent, to HK$6.83, and was ahead of its regional peers by 8.1 percentage points. “We think SEG will benefit from the demand-driven Asian petrochemicals upcycle that would support the launch of new projects by major customers and from refining facilities upgrades as China implements new auto fuel standards” in coming years, explains Ding. The analysts provide “information and notice occasionally on global politics and industry supply and demand dynamics of,” one fund manager observes. “We value their insight and instant messages on major issues.” Another backer hails their relationships with company executives and ability to provide corporate access, deeming the group “very responsive and well connected in the industry.”