Investment Rating - The investment rating for the company is Neutral [2][8]. Core Views - The company's revenue for the first half of the year was HKD 1.22 billion, a decrease of 5.4% year-on-year, while net profit attributable to shareholders was HKD 395 million, down 30.4% year-on-year, primarily due to increased curtailment rates and a higher market electricity proportion leading to lower electricity prices for existing projects [1][2]. - The average electricity price decreased by approximately 8% year-on-year, and the gross profit margin fell by 6.0 percentage points to 64.2% [1]. - The company has increased its proportion of lower-interest RMB loans from 13% at the end of last year to 22% by mid-year, resulting in a decrease in average borrowing costs from 6.05% to 4.71% [1]. - Despite the challenges, the company is still evaluating new projects with a strict assessment of a 10% curtailment rate and a 10% decrease in electricity prices, indicating that potential acquisition projects still have relatively high returns [1][2]. Financial Summary - Revenue (in million HKD) is projected to be 2,432 in 2024, down 3.4% year-on-year, with a net profit of 822 million HKD, reflecting a decrease of 17.2% [3][9]. - The company’s dividend per share is expected to be HKD 0.050 in 2024, with a dividend yield of 5.6% [3][9]. - The average tax rate is projected to increase to 26.0% in 2024, up from 23.4% in 2023 [7][9]. Market Performance - The stock price has seen a year-to-date decline of 37.76%, with a 52-week high of HKD 2.00 and a low of HKD 0.88 [5][4]. - The target price has been adjusted to HKD 1.00, reflecting a potential upside of 12.4% from the current price [2][8]. Industry Context - The report indicates that the solar power generation utilization rate in mainland China has decreased by 1.2 percentage points to 97%, with the National Energy Administration lowering the renewable energy utilization target from 95% to 90% [1]. - The report highlights that the pressure on consumption is expected to increase due to a significant rise in new installations, which could lead to further increases in curtailment rates and a wider market electricity proportion [1].
信义能源：弃光率、市场电量比例、所得税率上升拖累业绩