HDPI(SH:600027) HTSC·2024-08-23 04:03Investment Rating - The report maintains a "Buy" rating for both A-shares and H-shares of the company, with target prices set at 7.81 RMB and 5.61 HKD respectively [6][8]. Core Insights - In Q2 2024, the company's net profit attributable to shareholders decreased by 6% year-on-year, primarily due to a significant reduction in investment income from a stake in Inner Mongolia Fucheng Mining, which led to a decrease of 6.97 billion RMB in investment income. However, the company's operating profit continued to grow both year-on-year and quarter-on-quarter [3][4]. - The company achieved a revenue of 531.81 billion RMB and a net profit of 32.23 billion RMB in the first half of 2024, with a year-on-year decrease in revenue of 10.5% but an increase in net profit of 24.8% [3][4]. - The company plans to distribute its first interim cash dividend of 0.08 RMB per share, totaling 8.18 billion RMB [3]. Financial Performance Summary - In Q2 2024, the company's coal power generation volume decreased by 12.7% year-on-year, but the profit per kilowatt-hour increased by 0.5 cents due to a reduction in coal prices [4]. - The company's financial expenses decreased by 1.77 billion RMB in the first half of 2024, and its debt-to-asset ratio was 61.3% as of June 2024, down 1.32 percentage points from the end of 2023 [5]. - The company expects net profits attributable to shareholders for 2024, 2025, and 2026 to be 62 billion RMB, 74 billion RMB, and 86 billion RMB respectively for A-shares, and 61 billion RMB, 72 billion RMB, and 84 billion RMB for H-shares [3][6]. Valuation Metrics - The report provides a valuation based on 2024 expected PE/PB ratios for the company's renewable energy, thermal power, and hydropower segments, with A-shares at 16.5/1.05/2.5x and H-shares at 11.5/0.75/2.5x [6][25]. - The target market capitalization for A-shares is set at 799 billion RMB, while for H-shares it is 574 billion HKD [6][25].