SEP(SH:600021) Hua Xia Shi Bao·2025-05-17 02:17Core Viewpoint - Shanghai Electric Power is divesting non-core assets to focus on its main business of power generation, with plans to sell its entire stake in Minghua Electric Power Technology Co., Ltd. to a related party, the Shanghai Power Equipment Design Institute [1][2]. Group 1: Asset Sale Details - The sale involves a transaction price of 202 million yuan, representing an 88.46% premium over Minghua Electric's net assets of 138 million yuan [1][4]. - Minghua Electric's contribution to Shanghai Electric's overall performance has been minimal, accounting for less than 1% of its revenue [4]. - The buyer, Shanghai Power Equipment Design Institute, has total assets of 2.496 billion yuan and a net asset of 651 million yuan, with a debt ratio of 73.92% [4]. Group 2: Financial Performance - In the first half of 2024, Minghua Electric reported revenues of 63.87 million yuan and a net profit of 5.61 million yuan, while Shanghai Electric's revenues were 20.101 billion yuan and net profit was 1.327 billion yuan [4]. - Shanghai Electric's revenue growth has been limited, with a slight increase of 0.78% in 2024, and a decline in revenue reported in the first quarter of 2025 [7][8]. - The company's net profit for 2024 was 2.046 billion yuan, a year-on-year increase of 28.46% [7]. Group 3: Strategic Focus and Market Conditions - Shanghai Electric aims to enhance its core business by increasing its clean energy capacity, which is projected to exceed 60% by the end of 2024 [1][6]. - The company has faced challenges in revenue stability despite increasing its clean energy share, with significant fluctuations in net profit over recent years [6][7]. - The competitive landscape is evolving due to market reforms, with increased pressure from other power generation companies impacting both traditional and renewable energy sectors [8][9]. Group 4: Future Outlook - The company is focusing on expanding its wind power capacity, with 2.189 million kilowatts under construction compared to 1.745 million kilowatts of solar power [9]. - High accounts receivable, which reached 25.797 billion yuan by the end of 2024, pose a concern, as they account for 88.72% of the company's net assets [9].