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华能水电:盈利增长显著,未来装机增量可期

Investment Rating - The report assigns an "Accumulate-A" rating to the company, indicating a positive outlook for its stock performance in the near term [3][5]. Core Views - The company's significant profit growth is attributed to favorable water conditions in the Lancang River basin during the first half of 2024, leading to increased electricity generation [4]. - The company is positioned as China's second-largest hydropower company, backed by the Huaneng Group, and has rights to develop hydropower resources across the entire Lancang River basin [4]. - Upcoming projects, including the completion of the Toba Hydropower Station and various renewable energy initiatives, are expected to enhance future earnings [2][4]. Financial Performance - For the first half of 2024, the company reported operating revenue of 11.88 billion yuan, a year-on-year increase of 13.10%, and a net profit attributable to shareholders of 4.169 billion yuan, up 22.47% [1]. - The company achieved a basic earnings per share (EPS) of 0.22 yuan, reflecting a 22.59% increase year-on-year [1]. - The weighted average return on equity (ROE) was 5.97%, an increase of 1.78 percentage points compared to the previous year [1]. Electricity Generation - In the first half of 2024, the company generated 46.695 billion kWh of electricity, a year-on-year increase of 12.15%, with hydropower generation rising by 22.42% due to improved water inflow [1][2]. - The second quarter of 2024 saw a significant increase in electricity generation, with total grid-connected electricity reaching 30.214 billion kWh, a year-on-year increase of 41.68% [1]. Future Outlook - The company plans to invest 13.991 billion yuan in 84 new renewable energy projects, aiming to increase its renewable energy capacity to 5.0181 million kW [2]. - The anticipated rise in electricity prices in Yunnan province, where the company primarily operates, is expected to support revenue growth [1][4]. Valuation Metrics - The projected EPS for 2024-2026 is expected to be 0.49, 0.54, and 0.60 yuan, respectively, with corresponding price-to-earnings (P/E) ratios of 22.4, 20.2, and 18.3 [5][6]. - The company's cash flow remains robust, with a cash dividend payout ratio of 58.42% for 2023 and a commitment to distribute 50% of distributable profits as dividends over the next three years [5].