BUY Sinopec (0386.HK) TP HK$11.00

Lehman Brothers raises target price for Sinopec (0386.HK) to HK$11.00 from HK$8.65 after incorporating estimated value of its oil and gas discoveries, as well as from 2-3% rise in earnings forecast due to strong chemical EBIT. "Within the China oil sector, we forecast that the company will achieve the highest y-o-y earnings growth of 41% compared to no growth for CNOOC (0883.HK) and 17% growth for PetroChina (0857.HK) for FY07." Adds valuation still attractive at 9.5X 2007 forecast P/E.