Huaneng Hydropower(SH:600025) Minsheng Securities·2024-08-28 08:11Investment Rating - The report maintains a "Cautious Recommendation" rating for Huaneng Hydropower [1][2] Core Views - The company achieved a revenue of 11.88 billion yuan in H1 2024, a year-on-year increase of 13.10%, and a net profit attributable to shareholders of 4.169 billion yuan, up 22.47% year-on-year [1] - The increase in revenue and net profit is primarily driven by a significant rise in power generation, with total generation reaching 46.695 billion kWh, a 12.15% increase year-on-year [1] - The company has launched new hydropower and photovoltaic projects, enhancing its capacity and profitability [1] - A shareholder return plan has been announced, with a commitment to distribute at least 50% of the annual distributable profit in cash [1] Summary by Sections Financial Performance - H1 2024 revenue was 11.88 billion yuan, with a net profit of 4.169 billion yuan, and basic earnings per share of 0.22 yuan, reflecting a 22.59% increase year-on-year [1] - The gross margin was 59.03%, slightly up by 0.89 percentage points, and the net profit margin was 38.77%, an increase of 2.71 percentage points year-on-year [1] Power Generation - The company benefited from abundant water supply and increased installed capacity, with hydropower generation at 44.588 billion kWh (up 8.99%) and renewable energy generation at 2.107 billion kWh (up 189.82%) [1] - The average on-grid electricity price was 0.2536 yuan/kWh, a slight decrease of 0.28% year-on-year, but remained stable [1] Project Development - The commissioning of the first unit of the Toba Hydropower Station added 350,000 kW to the installed capacity, with plans for full operation by December 2024 [1] - The company plans to invest 13.991 billion yuan in 84 new renewable energy projects, expecting to add 3.09 million kW of capacity, a year-on-year increase of 160.26% [1] Shareholder Returns - The company announced a shareholder return plan for 2024-2026, committing to distribute at least 50% of the annual distributable profit in cash [1] - In 2023, the company distributed 3.24 billion yuan in dividends, with a payout ratio of 42.42% [1] Future Outlook - The report forecasts net profits for 2024, 2025, and 2026 to be 9.047 billion yuan, 9.700 billion yuan, and 10.252 billion yuan, respectively, with corresponding EPS of 0.50 yuan, 0.54 yuan, and 0.57 yuan [2][6] - The price-to-earnings ratio is projected to be 23, 21, and 20 for the years 2024, 2025, and 2026, respectively [2]