CHINA RES POWER(00836) 海通国际·2024-09-13 23:37Investment Rating - Maintains an OUTPERFORM rating with a target price of HK18.52 [3] - The stock is valued at 6x PE for 2024, reflecting confidence in the company's earnings growth [5] Core Views - Thermal power profitability significantly improved in H1 2024, with core profits surging 273.9% YoY to HKD 2.715 billion, driven by lower fuel costs and reduced impairments [4][5] - Renewable energy business faced profit pressure, with core profits declining 6.7% YoY to HKD 5.556 billion, despite a 5.8% YoY revenue growth, due to lower utilization hours and electricity prices [5][12] - The company's ROE reached 10.7%, above the 10-year historical average, supported by strong thermal power performance and reduced impairments [4] Financial Performance - Revenue remained stable at HKD 51.12 billion in H1 2024, while net profit surged 38.9% YoY to HKD 9.363 billion, driven by thermal power profitability [4] - Thermal power revenue declined 3.3% YoY to HKD 33.6 billion, but core profits surged due to a 10.7% YoY decline in average fuel costs [5] - Renewable energy revenue grew 5.8% YoY to HKD 13.152 billion, but profits were pressured by lower utilization hours and electricity prices [12] Strategic Developments - The company continues to advance its new energy strategy, with 24.7GW of renewable energy capacity, accounting for 39.3% of total installed capacity [5] - Wind power capacity reached 19.12GW, with sales volume increasing 6.9% YoY, while photovoltaic sales volume surged 204.9% YoY [12] Valuation and Forecasts - The company is expected to achieve net profits of HKD 14.47 billion, HKD 16.504 billion, and HKD 18.724 billion for 2024, 2025, and 2026, respectively, driven by thermal power recovery and new energy contributions [5] - Diluted EPS is forecasted to grow from HKD 3.01 in 2024 to HKD 3.89 in 2026, reflecting strong earnings growth [4]