Ge Long Hui·2025-06-07 18:43Core Viewpoint - The company is focusing on both stable and growth-oriented businesses, with expectations of profit contributions from regulated operations and potential growth from zero-carbon projects [1][2]. Stable Business - In Q1, electricity sales in Hong Kong decreased by 2.6% year-on-year to 7.091 billion kWh, influenced by weather conditions and the leap year in 2024 [1]. - The company anticipates steady profit contributions as capital investments solidify, with a projected capital expenditure of HKD 52.9 billion from 2024 to 2028 [1]. - The nuclear power business saw increased generation due to reduced downtime, while the average electricity price from the Yangjiang Nuclear Power Station declined as market trading increased [1]. Growth Business - The company is expanding its zero-carbon asset portfolio, with projects in China and India successfully launched in Q1, including a 150 MW wind project in Guangxi and a 251 MW wind farm in India [2]. - From 2024 to 2029, the company plans to double its renewable energy capacity in mainland China from approximately 3 GW to 6 GW, and increase its renewable energy and storage capacity in India from 2.3 GW to 8 GW [2]. - The Australian storage project is set to grow from 0.1 GW to 1.6 GW, with renewable energy projects increasing from 0.9 GW to 3 GW [2]. Dividend Policy - The company has maintained its dividend per share since 1987, with a proposed interim dividend of HKD 0.63 per share for 2025, unchanged from the previous year [2]. - The total liquidity as of the end of 2024 is projected to reach HKD 36 billion, indicating potential for future dividend increases [2]. Profit Forecast and Valuation - The company maintains its net profit forecast for 2025-2027 at HKD 12.1 billion, HKD 12.4 billion, and HKD 13.0 billion, respectively, with an EPS of HKD 4.79 for 2025 [3]. - The target price is set at HKD 79.37, based on a price-to-book ratio of 1.85x for 2025, which is above the three-year historical average of 1.51x [3].