The analyst rating from Daiwa is influenced by the reshaped risk-reward profile of the oil and gas sector due to the Hormuz Strait crisis. Despite a potential easing of the situation, it is expected that oil and gas prices will remain elevated for an extended period. Daiwa's top picks in this sector are ENN ENERGY and NEWAY, indicating a positive outlook for these companies. However, the firm maintains a cautious stance on city gas stocks, predicting that the short-term rise in natural gas prices will negatively impact profit margins for these stocks, particularly for CHINA RES GAS and other distributors with a high proportion of liquefied natural gas if high prices persist.
