SHENHUO COAL&POWER(000933) 华创证券·2024-08-20 20:06Investment Rating - The report maintains a "Recommendation" rating for the company, with a target price of 21.25 CNY compared to the current price of 17.06 CNY, indicating a potential upside of 25% [1]. Core Views - The company's performance in the first half of 2024 was slightly below expectations, primarily due to declines in both coal sales and prices, alongside significant increases in aluminum raw material costs [1]. - The report highlights that the average prices for domestic electrolytic aluminum and alumina increased by 7% and 18% year-on-year, while the average prices for various types of coal decreased significantly, with declines ranging from 17% to 23% [1]. - The company achieved a revenue of 18.22 billion CNY in the first half of 2024, a year-on-year decrease of 21.35%, while net profit attributable to shareholders was 2.284 billion CNY, down 16.62% year-on-year [1]. Financial Performance Summary - The company reported total revenue of 182.21 billion CNY for the first half of 2024, a decrease of 21.35% year-on-year [1]. - Investment income rose to 270 million CNY, an increase of 87% year-on-year [1]. - Management expenses increased by 30% to 380 million CNY, while non-operating expenses surged by 326% to 125 million CNY [1]. - The net cash flow from operating activities showed a significant decline, with a net cash flow of -6.9 billion CNY, reflecting a decrease of 924.67% [1]. Production and Sales Summary - The company produced 3.2275 million tons of coal and sold 3.1506 million tons, representing year-on-year declines of 15% and 19%, respectively [1]. - In the electrolytic aluminum segment, production and sales were stable, with 749,900 tons produced and sold, marking a year-on-year increase of 3% and 2% [1]. - The report notes that the company’s integrated industrial chain is expected to enhance performance in the future [1]. Future Outlook - The report projects net profits for the company to be 5.189 billion CNY, 6.424 billion CNY, and 7.252 billion CNY for the years 2024, 2025, and 2026, respectively, indicating a year-on-year decrease of 12.1% in 2024, followed by increases of 23.8% and 12.9% in the subsequent years [1][3]. - The valuation for the coal and electrolytic aluminum segments is based on comparable company analysis, with estimated PE ratios of approximately 8 times and 10 times for 2024 [1].