SCTE(600674) 华源证券·2024-10-16 13:00Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook on its performance and potential growth [2][3]. Core Insights - The company reported a net profit attributable to shareholders of 4.422 billion yuan for the first three quarters of 2024, representing a year-on-year increase of 15.1%. The net profit for the third quarter alone was 2.12 billion yuan, up 21.55% year-on-year, aligning with market expectations [2]. - The growth in performance is primarily attributed to the company's investments in hydropower, a decrease in financial expenses due to convertible bond conversions, and a decline in interest rates. The financial expenses for the first three quarters of 2024 were 344 million yuan, down approximately 125 million yuan from 469 million yuan in the same period of 2023, marking the largest reduction in recent years [2]. - The company plans to increase its stake in Yalong River Hydropower by investing 7.2 billion yuan as part of a larger 15 billion yuan capital increase, which is expected to enhance its growth prospects [2]. - The report highlights that the electricity price for the company's hydropower stations increased by 4.6% year-on-year in the third quarter, reflecting a tightening supply-demand situation in Sichuan's electricity market [2]. Summary by Sections Financial Performance - The company achieved a total profit of 3.88 billion yuan in the third quarter, with investment income increasing by 334 million yuan year-on-year, mainly from Yalong River and Dadu River investments [2]. - The projected net profits for 2024, 2025, and 2026 are 5.111 billion yuan, 5.390 billion yuan, and 5.615 billion yuan respectively, with corresponding price-to-earnings ratios of 17, 16, and 15 times [3]. Market Position and Growth Potential - The company is positioned to benefit from the growth of Yalong River Hydropower, which aims to expand its hydropower capacity to 23 million kilowatts and new energy capacity to 20 million kilowatts by 2030 [2]. - The report suggests that the hydropower sector, characterized by low covariance, is likely to experience a revaluation, indicating long-term investment value [3].