Investment Rating - The report rates the gaming industry as "high" for investment [1] Core Views - The report emphasizes the importance of the "Solid Waste Comprehensive Treatment Action Plan," which aims for significant improvements in solid waste management by 2030, including a target of 4.5 billion tons of comprehensive utilization of major solid waste and 510 million tons of recycling of key resources [2][5][7] - It highlights the shift in the energy sector towards diversified revenue models for thermal power companies, recommending several key players in the industry [8] - The report discusses the current trends in natural gas pricing, noting a general decline in global gas prices due to mild weather conditions and stable supply [10][29] - It outlines the transition of hydrogen energy towards becoming a "regulator" of the power grid, emphasizing its role in energy storage and management [31][33] Summary by Sections 1. Environmental Protection - The "Solid Waste Comprehensive Treatment Action Plan" was released on January 4, aiming to enhance solid waste management and promote a green economy [5] - By 2030, the plan targets a comprehensive utilization of 4.5 billion tons of major solid waste and 510 million tons of recycling of key resources [2][6] - The focus is on industrial, urban, and agricultural waste, with a comprehensive governance approach to illegal dumping and construction waste [6][7] 2. Natural Gas - As of January 9, the Henry Hub spot price in the U.S. was $2.87/mmBtu, reflecting a weekly decline of 28.24% [10][11] - The report notes that the European gas prices have also decreased, with the TTF spot price at €29.00/MWh, down 1.43% week-on-week [10][16] - The overall gas market is characterized by stable supply and mild weather, leading to lower demand and prices [10][29] 3. Hydrogen Energy - The report discusses the integration of hydrogen energy into the power grid, highlighting its potential for large-scale energy storage and management [31] - It emphasizes the role of hydrogen in addressing renewable energy challenges and improving grid stability [31][33] - The report recommends companies involved in hydrogen production and technology as key investment opportunities [33] 4. Weekly Market Review - The report notes that the electric power equipment, gas, and environmental protection sectors outperformed the Shanghai and Shenzhen 300 index during the week of January 5 to January 9 [34] - It provides insights into the performance of various sectors, indicating a positive trend for certain energy and environmental stocks [36][39] 5. Company and Industry Dynamics - The report highlights the establishment of national zero-carbon parks, which will receive significant support for green energy initiatives [39] - It mentions the successful completion of green power transactions in Gansu, indicating a growing market for renewable energy [40][43] - The report includes updates on major companies' performance and strategic developments in the energy sector [44]

Investment Rating - The report maintains a positive outlook on the industry, indicating a "Look Favorably" investment rating [1]. Core Insights - The report highlights the release of the "Comprehensive Solid Waste Management Action Plan," which aims to enhance solid waste management and promote a circular economy by 2030, targeting a comprehensive utilization of 4.5 billion tons of major solid waste and 510 million tons of recyclable resources annually [2][6][8]. - Global natural gas prices have generally declined, influenced by mild weather conditions, with significant drops in prices across various markets, including a 28.24% decrease in the US Henry Hub spot price [11][12][18]. - The hydrogen energy sector is evolving towards becoming a key regulator in the power grid, with initiatives to integrate clean hydrogen production and utilization into microgrid systems, enhancing energy storage capabilities [35][37]. Summary by Sections 1. Environmental Protection - The "Comprehensive Solid Waste Management Action Plan" aims for significant improvements in solid waste management by 2030, with specific targets for waste recycling and resource utilization [2][6]. - The plan emphasizes the need for a circular economy that does not rely on subsidies, focusing on industrial collaboration and technological innovation to create a sustainable waste management system [7][8]. 2. Natural Gas - Natural gas prices have seen a significant decline, with the US Henry Hub spot price at $2.87/mmBtu, reflecting a 28.24% week-over-week drop [11][12]. - The report notes that the demand for natural gas is expected to remain weak in Northeast Asia, contributing to a slight decrease in LNG prices [11][30]. - Recommendations include focusing on integrated natural gas companies that are expected to benefit from cost reductions and improved profitability [32]. 3. Hydrogen Energy - The report discusses the strategic positioning of hydrogen energy as a flexible load regulator within the power grid, highlighting its potential to enhance energy storage and consumption efficiency [35][37]. - It emphasizes the importance of hydrogen energy in achieving energy security and autonomy, recommending companies involved in hydrogen production [35][37]. 4. Weekly Market Review - The report indicates that the electricity equipment, gas, and environmental protection sectors outperformed the Shanghai and Shenzhen 300 index during the review period [38]. 5. Company and Industry Dynamics - The report outlines significant developments in the renewable energy sector, including the establishment of national zero-carbon parks and the increase in green electricity trading volumes, which are expected to enhance market opportunities for leading companies in the sector [44][48].

Core Viewpoint - Daiwa has upgraded the rating of Hong Kong and China Gas (00003) from "Hold" to "Outperform" based on higher free cash flow forecasts and has raised the 12-month target price from HKD 7.1 to HKD 7.7 [1] Group 1: Financial Projections - Earnings per share (EPS) forecasts for 2025 to 2026 have been increased by 2% due to improved profitability predictions for gas and green fuel businesses [1] - The company is expected to maintain its dividend commitment, with a projected annual dividend of HKD 0.35 per share in 2025, yielding approximately 4.9% [1] Group 2: Business Performance - The recovery in profitability from the green fuel business is expected to improve the fundamentals of Hong Kong and China Gas, alongside potential spin-off of Eco Ceres after 2026, which could enhance per-share dividends [1] - The net profit for the first half of last year was negatively impacted by a net loss of RMB 130 million from Eco Ceres, primarily due to weak prices of sustainable aviation fuel (SAF) [1] - It is anticipated that the company will turn profitable in the second half of 2025, driven by a rebound in sustainable aviation fuel prices and new production capacity [1] Group 3: Market Conditions - The green fuel business is expected to see a turnaround as sustainable aviation fuel prices rose in the second half of last year, with the potential for steady growth in the first half of this year due to a low base from the previous year [1]

Core Viewpoint - Daiwa has upgraded the rating of Hong Kong and China Gas (00003) from "Hold" to "Outperform" based on higher free cash flow forecasts and has raised the 12-month target price from HKD 7.1 to HKD 7.7 using a sum-of-the-parts valuation method [1] Group 1: Financial Projections - Earnings per share (EPS) forecasts for 2025 to 2026 have been increased by 2% due to revised profit expectations for gas and green fuel businesses [1] - The company is expected to maintain its dividend commitment, with a projected annual dividend of HKD 0.35 per share in 2025, yielding approximately 4.9% [1] Group 2: Business Performance - The recovery in profitability from the green fuel business is anticipated to improve the fundamentals of Hong Kong and China Gas, alongside potential spin-off of Eco Ceres post-2026, which could enhance dividend payouts [1] - The net profit for the first half of last year was negatively impacted by a net loss of RMB 130 million from Eco Ceres, primarily due to weak prices of sustainable aviation fuel (SAF) [1] - A turnaround to profitability is expected in the second half of 2025, driven by rising prices of sustainable aviation fuel and new production capacity [1] Group 3: Market Conditions - The green fuel business is projected to experience a turnaround as sustainable aviation fuel prices increased in the second half of last year, with steady growth anticipated in the first half of this year due to a low base from the previous year [1]

Group 1 - The core viewpoint of the report is that Citigroup has revised its earnings forecast for Hong Kong and China Gas (00003) for 2025 to 2027, expecting a growth range of 2% to 5% [1] - Citigroup maintains a target price of HKD 7 for the gas company, with a neutral rating, indicating a stable outlook despite the earnings forecast revision [1] - The report highlights that the gas company's earnings for the previous year were 8% lower than market expectations, with an anticipated year-on-year decline of 2%, although core earnings are expected to remain relatively stable when excluding foreign exchange impacts [1] Group 2 - Citigroup expects the gas company to maintain a dividend of HKD 0.35 per share for the previous year, resulting in a dividend yield of 5% [1] - The report emphasizes that investors are primarily focused on the gas company's dividends [1] - In the Hong Kong utilities sector, Citigroup prefers China Resources Gas (00270), assigning it a "buy" rating with an expected dividend yield of 4.9% for the previous year [1]

Core Viewpoint - Citigroup has revised its earnings forecast for Hong Kong and China Gas (00003) for 2025 to 2027, expecting a growth range of 2% to 5% [1] Earnings Forecast - The revision of earnings estimates for the gas company is relatively moderate, maintaining a target price of HKD 7 and a neutral rating [1] - The gas company's earnings last year were 8% lower than market expectations, with a projected year-on-year decline of 2%, even when excluding foreign exchange impacts [1] Dividend Expectations - Citigroup anticipates that the gas company will maintain its dividend per share at HKD 0.35, resulting in a dividend yield of 5% [1] - The focus for investors remains on the gas company's dividends [1] Industry Comparison - In the Hong Kong public utility sector, Citigroup prefers China Resources Gas (00270), assigning a "buy" rating with an expected dividend yield of 4.9% for the previous year [1]

Core Viewpoint - The report from Daiwa upgrades the outlook for the mainland natural gas industry to "neutral," anticipating improvements in the fundamentals of companies by 2026 [1] Industry Summary - It is expected that the sales volume of major natural gas companies in mainland China will see low single-digit growth compared to last year's low base by 2026 [1] - The gas price margin is projected to increase by 1 to 2 cents year-on-year, assuming a mild winter and no significant deterioration in competition [1] - The new connection volume for major companies is expected to decline by low to mid-double digits year-on-year, although its impact is gradually diminishing [1] Company Summary - Major companies are expected to maintain stable or slightly increased dividends year-on-year [1] - The report favors high-yield stocks such as China Gas (00384) and Hong Kong and China Gas (00003), with target prices set at HKD 8.3 and HKD 7.7 respectively, both rated as "outperform" [1] - The rating for Hong Kong and China Gas has been upgraded from "hold" to "outperform" due to potential turnaround in its EcoCeres business [1]

Core Viewpoint - Daiwa has upgraded its view on the mainland natural gas industry to "neutral," anticipating improvements in the fundamentals of companies by 2026 [1] Industry Summary - It is expected that the sales volume of major natural gas companies in the mainland will see low to mid-single-digit growth compared to last year's low base by 2026 [1] - The gas price differential is projected to increase by 1 to 2 cents year-on-year, assuming a mild winter and no significant deterioration in competition [1] - The new connection volume for major companies is expected to decline by low to mid-double digits year-on-year, although the impact is gradually diminishing [1] Company Summary - Major companies are expected to maintain stable or slightly increased dividends year-on-year [1] - The company prefers high-yield stocks such as China Gas and Towngas, with target prices set at HKD 8.3 and HKD 7.7 respectively, both rated as "outperform" [1] - Towngas's rating has been upgraded from "hold" to "outperform" due to potential turnaround in its EcoCeres business [1]

股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年12月31日 狀態: 新提交 致：香港交易及結算所有限公司 公司名稱: 香港中華煤氣有限公司 呈交日期: 2026年1月6日 I. 法定/註冊股本變動 不適用 FF301 第 1 頁 共 10 頁 v 1.1.1 FF301 II. 已發行股份及/或庫存股份變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | 於香港聯交所上市 (註1) | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 00003 | 說明 | | | | | | | | | 已發行股份（不包括庫存股份）數目 | | 庫存股份數目 | | 已發行股份總數 | | | 上月底結存 | | | 18,659,870,098 | | 0 | | 18,659,870,098 | | 增加 / 減少 (-) | | | 0 | | 0 | | | | 本月底結存 | | | 18,659,870,098 | | 0 | | 18,659, ...

Investment Rating - The report maintains a positive outlook on the power and gas sectors, indicating potential investment opportunities in these areas [1]. Core Insights - The 2026 long-term electricity prices are under pressure, with significant declines observed in transaction prices across various provinces, reflecting a shift in the power generation model from reliance on thermal power to a more diversified income structure [6][7]. - Natural gas consumption saw a year-on-year increase of 5.1% in November 2025, indicating a recovery in demand, particularly due to heating needs during the winter season [34]. - The report highlights the importance of optimizing the electricity market mechanism and restructuring the power generation mix as key future trends [7]. Summary by Sections 1. Electricity: 2026 Long-term Electricity Prices - The annual transaction results for 2026 show a total transaction volume of 2,724.81 billion kWh in Jiangsu, with a weighted average price of 344.19 yuan/MWh, down 16.55% from the previous year [6][8]. - Similar trends are observed in Guangdong and Anhui, with prices decreasing by 5.03% and 10.09% respectively [6][8]. - The report suggests that coastal provinces will face significant pricing pressure in 2026, as the role of thermal power shifts from being the main energy source to a regulatory support role [7]. 2. Gas: November Natural Gas Consumption - In November 2025, the apparent consumption of natural gas reached 362.8 billion m³, marking a 5.1% increase year-on-year, while the total consumption from January to November was 3,880 billion m³, a slight decline of 0.1% [34]. - The report notes that the increase in consumption is attributed to a low base from the previous year and a recovery in industrial gas demand [34]. - The report also highlights a favorable trend in natural gas pricing, with a decrease in costs due to lower international oil prices and improved supply conditions [36]. 3. Investment Analysis Recommendations - For thermal power, the report recommends companies with integrated coal and power operations, such as Guodian Power and Inner Mongolia Huadian, as well as those with significant large unit ratios like Datang Power and Huaneng International [10]. - In the hydropower sector, companies like Yangtze Power and Guotou Power are recommended due to their sufficient capacity and expected improvements in profit margins [10]. - The report suggests focusing on nuclear power companies like China Nuclear Power and China General Nuclear Power, which have stable cost structures and high utilization hours [10]. - For green energy, companies such as Xintian Green Energy and Longyuan Power are highlighted for their stable returns and increasing operational benefits from environmental value releases [10].