HDPI(SH:600027) HTSC·2024-08-02 01:03Investment Rating - The report maintains a "Buy" rating for both A and H shares, with target prices set at RMB 7.97 and HKD 5.62 respectively [5][6][23]. Core Views - The company plans to acquire unlisted thermal power assets from China Huadian Group, which is expected to enhance its thermal power capacity significantly, increasing its controlled and equity-installed capacity by 29% and 23% respectively, and potentially boosting net profit attributable to shareholders by 11% [3][4]. - The acquisition price for the shares is set at RMB 5.13, which is 80% of the average trading price over the previous 20 days [4]. - The expected contribution from the acquired assets includes a projected net profit of RMB 6.6 billion for 2023, with a return on equity (ROE) of 7.7% [4][6]. Financial Projections - The report adjusts the company's net profit forecasts for 2024-2026 to RMB 62 billion, RMB 74 billion, and RMB 86 billion for A shares, and RMB 61 billion, RMB 72 billion, and RMB 84 billion for H shares respectively [3][7]. - The projected revenue for the company is expected to grow from RMB 117.176 billion in 2023 to RMB 125 billion by 2026, with a compound annual growth rate (CAGR) of approximately 2.89% [7]. - The report highlights an increase in earnings per share (EPS) from RMB 0.44 in 2023 to RMB 0.84 in 2026, reflecting a positive growth trajectory [7]. Valuation Metrics - The report provides a valuation based on 2024 estimates, with price-to-earnings (PE) ratios of 17 for A shares and 12 for H shares, and price-to-book (PB) ratios of 1.10 for A shares and 0.75 for H shares [6][23]. - The total market value is estimated at RMB 114.275 billion, with a net asset value of RMB 30.582 billion for thermal power assets [13][23]. - The report indicates that the company's renewable energy assets are valued at RMB 62.174 billion, contributing to the overall market valuation [13][23].