CYPC(600900) 华源证券·2024-09-04 02:30Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for its stock performance in the near term [2]. Core Insights - The company reported a revenue of 34.808 billion yuan for the first half of 2024, a year-on-year increase of 12.38%, and a net profit attributable to shareholders of 11.362 billion yuan, up 27.92%, aligning with expectations [2]. - Improved water inflow and a slight decline in electricity prices are expected to influence the company's performance, with total electricity generation reaching 120.618 billion kWh, a 16.86% increase year-on-year [2]. - Financial expenses decreased more than anticipated, contributing significantly to profit growth, with interest expenses dropping to 5.704 billion yuan, a reduction of 777 million yuan compared to the same period in 2023 [2]. - The report emphasizes the continued attractiveness of hydropower assets, suggesting that the market is re-evaluating the low correlation of hydropower assets, which could lead to a structural bull market for this sector [2]. Summary by Sections Financial Performance - The company achieved a total revenue of 34.808 billion yuan in H1 2024, with a net profit of 11.362 billion yuan, reflecting strong growth [2]. - The financial expenses saw a significant decline, with interest expenses at 5.704 billion yuan, down from the previous year [2]. - Investment income rose to 2.56 billion yuan, marking a 20.55% increase year-on-year [2]. Market Analysis - The report highlights a favorable shift in the discount rate for equity assets, with the implied discount rate for the company decreasing from approximately 10% in 2020 to 7.1% by mid-2024 [2]. - The narrowing of the risk-free rate and credit spread is seen as beneficial for equity assets, particularly in the hydropower sector, which is less affected by macroeconomic fluctuations [2]. Earnings Forecast - The report projects net profits for 2024, 2025, and 2026 to be 33.994 billion yuan, 35.742 billion yuan, and 37.423 billion yuan respectively, with corresponding price-to-earnings ratios of 21, 20, and 19 [4][5].