CYPC(SH:600900) Xin Lang Cai Jing·2025-07-31 00:26Core Viewpoint - Yangtze Power announced its mid-year performance report for 2025 and a proposal for the expansion of the Gezhouba shipping hub, indicating a focus on enhancing operational capacity and maintaining financial stability [1][3]. Financial Performance - In Q2 2025, the company's net profit attributable to shareholders increased by 5% year-on-year to 7.8 billion yuan, aligning with expectations; the adjustment of six reservoirs helped mitigate the impact of water inflow fluctuations [2]. - The company experienced a decrease in water inflow by 18% year-on-year, but power generation increased by 1.6% due to the performance of specific power stations, with revenue rising by 2% to 19.6 billion yuan [2]. Investment and Expansion Plans - The company plans to invest 26.6 billion yuan from its own funds to expand the Gezhouba shipping hub, with an average annual capital expenditure of about 4 billion yuan over a construction period of 91 months [3]. - The expansion aims to enhance social and economic benefits, increasing annual power generation from approximately 15.8 billion kWh to 18 billion kWh, thereby reducing the constraints on power dispatch caused by shipping operations [3]. Cash Flow and Dividend Policy - In 2024, the company's operating cash flow is projected to reach 59.6 billion yuan, with free cash flow at 45.2 billion yuan, allowing for a dividend payout of 23.1 billion yuan, resulting in a dividend rate of 71% [3]. - The company maintains a long-term dividend payout target of 70%, indicating strong cash flow capabilities to support this goal despite the new investment [3]. Profit Forecast and Valuation - The profit forecasts for 2025 and 2026 have been adjusted upwards by 2.8% and 3% to 34.1 billion yuan and 35.2 billion yuan, respectively, with year-on-year growth of 5% and 3% [4]. - The target price remains unchanged at 31.5 yuan, with a potential upside of 9.8% from the current stock price, reflecting a price-to-earnings ratio of 20.6x for the current price and 22.6x for the target price [4].