Changjiang Securities·2024-07-23 13:31Investment Rating - The investment rating for Huadian International is "Buy" and is maintained [5]. Core Views - The acquisition of high-quality assets from the group will significantly expand the company's installed capacity, with a total of 1,552.19 MW being acquired, which includes 623 MW of coal-fired and 929.19 MW of gas-fired capacity. After the completion of this asset injection, the company's controlling installed capacity will increase by 26.56%, and the equity installed capacity will grow by 18.02% [6][7]. - The assets being injected are strategically located in load centers, which is expected to enhance the overall profitability of the company. The acquisition is anticipated to effectively increase the company's EPS [6][7]. Summary by Sections Event Description - The company announced a suspension of trading regarding the planned issuance of shares and cash payment for the acquisition of 80% of Huadian Jiangsu Energy Co., Ltd. and other related assets from the Huadian Group [5]. Event Commentary - The acquisition will lead to a significant expansion in the company's installed capacity. The acquired assets include various energy companies with a total controlling installed capacity of 1,552.19 MW, which will enhance profitability as the operating environment improves. For instance, Huadian Jiangsu Energy achieved a revenue of 25.305 billion yuan in 2023, a year-on-year increase of 5.14%, and a net profit of 168 million yuan, up 111.24% year-on-year [6][7]. - The operating environment is steadily improving, with coal prices declining, which is expected to relieve cost pressures for the company. The company has a substantial reserve of non-listed conventional energy generation assets that may be injected into the listed company in the future, indicating broad growth potential [7]. Investment Recommendations and Valuation - The projected EPS for 2024-2026 is estimated to be 0.69 yuan, 0.75 yuan, and 0.84 yuan, respectively, with corresponding PE ratios of 8.79x, 8.10x, and 7.25x. The "Buy" rating is maintained without considering the impact of the asset acquisition [7].