HPI(600011) 兴业证券·2024-08-08 01:01Investment Rating - Maintain "Overweight" rating [1] Core Views - The company's 2024Q2 revenue was RMB 534.39 billion, a year-on-year decrease of 12.05%, with net profit attributable to the parent company of RMB 2.858 billion, a year-on-year decrease of 29.58% [1] - Operating cash flow in 2024Q2 was RMB 11.46 billion, a year-on-year increase of 50.37%, indicating improved cash flow despite declining profits [1] - The company's coal power business was significantly impacted by load factors, with a 40.21% year-on-year decline in profits from Tuas Power [1] - Green power business showed slight growth in 2024H1, with wind and solar power profits increasing by 0.2% and 24% respectively [1] - The company's 2024-2026 net profit attributable to the parent company is forecasted to be RMB 11.316 billion, RMB 12.032 billion, and RMB 12.492 billion, with year-on-year growth rates of 34.0%, 6.3%, and 3.8% respectively [1] Financial Performance - Revenue for 2023 was RMB 254.397 billion, with a year-on-year growth of 3.1%, and is expected to be RMB 253.373 billion, RMB 259.708 billion, and RMB 268.936 billion for 2024E, 2025E, and 2026E respectively [1] - Net profit attributable to the parent company for 2023 was RMB 8.446 billion, with expected growth rates of 34.0%, 6.3%, and 3.8% for 2024E, 2025E, and 2026E respectively [1] - Gross margin for 2023 was 12.1%, with slight fluctuations expected in the coming years, reaching 12.4% by 2026E [1] - ROE for 2023 was 6.4%, expected to increase to 8.8% in 2024E and remain stable around 8.6%-8.7% in the following years [1] - EPS for 2023 was RMB 0.54, expected to increase to RMB 0.72, RMB 0.77, and RMB 0.80 for 2024E, 2025E, and 2026E respectively [1] Business Segments - Coal power: In 2024Q2, the company's coal power generation was 78.133 billion kWh, a year-on-year decrease of 9.65%, with a profit of RMB 1.155 billion, down significantly from RMB 2.825 billion in 2024Q1 [1] - Green power: Wind and solar power generation in 2024Q2 was 16.16 billion kWh and 8.75 billion kWh respectively, with profits of RMB 1.616 billion and RMB 875 million, showing mixed performance compared to the previous year [1] - Overseas operations: Tuas Power's net profit in 2024H1 was RMB 1.429 billion, a year-on-year decrease of 40.21% [1] Valuation - The company's PE ratio for 2024E, 2025E, and 2026E is 10.5x, 9.8x, and 9.5x respectively, based on the closing price on August 2, 2024 [1] - The company's PB ratio is expected to remain stable around 0.9x in the coming years [2]