CYPC(600900) 长江证券·2024-07-09 03:01Investment Rating - The investment rating for the company is "Buy" and is maintained [4]. Core Insights - The company has shown a significant increase in hydropower generation, with a total of 1,206.18 billion kWh in the first half of 2024, representing a year-on-year growth of 16.86%. In the second quarter alone, the generation reached 678.71 billion kWh, up 42.54% year-on-year [4][5]. - The improvement in water inflow has positively impacted the company's performance outlook, with the Udongde Reservoir's inflow increasing by 11.40% and the Three Gorges Reservoir's inflow rising by 19.67% compared to the previous year [4]. - The company benefits from stable hydropower costs and is expected to maintain high growth in performance due to its substantial investments in various hydropower companies [4][5]. - The ongoing market reforms are expected to provide long-term support for electricity prices, particularly in regions with high hydropower marketization [4]. - The company is committed to a minimum dividend payout ratio of 70%, which, combined with strong performance, suggests attractive dividend returns for investors [5]. Summary by Sections Hydropower Generation Performance - In the first half of 2024, the company achieved a total hydropower generation of 1,206.18 billion kWh, a 16.86% increase year-on-year. The second quarter saw a generation of 678.71 billion kWh, marking a 42.54% increase year-on-year [4][5]. Water Inflow and Market Conditions - The water inflow conditions have improved significantly, with the Udongde Reservoir's inflow at approximately 366.60 billion cubic meters, an increase of 11.40% year-on-year, and the Three Gorges Reservoir's inflow at about 1,479.41 billion cubic meters, up 19.67% year-on-year [4]. - The company is expected to benefit from a stable cost structure and high growth in the performance of its hydropower investments [4]. Long-term Outlook and Investment Value - The company anticipates a positive outlook for the entire year, with expectations to exceed the initial target of 3,088 billion kWh in electricity generation due to favorable water conditions [5]. - The reduction in macroeconomic interest rates is expected to lower funding costs, enhancing the company's valuation as a recognized long-term asset [5]. - The earnings per share (EPS) forecasts for 2024-2026 are projected at 1.37 yuan, 1.40 yuan, and 1.48 yuan, respectively, with corresponding price-to-earnings (PE) ratios of 21.41, 20.93, and 19.77 [5].