GOLDEN SUN SECURITIES·2024-09-01 03:40Investment Rating - The report maintains a "Buy" rating for China Shenhua (601088.SH) [3] Core Views - The company demonstrates stable performance and showcases its leading position in the industry despite a slight decline in revenue and net profit [1][2] - The coal production and sales remain stable, with long-term contracts providing a buffer against price fluctuations [1] - The company is progressing in increasing coal production capacity, indicating potential for future growth [2] Summary by Sections Financial Performance - In H1 2024, the company achieved operating revenue of CNY 168.08 billion, a year-on-year decrease of 0.81%, and a net profit attributable to shareholders of CNY 29.50 billion, down 11.34% [1] - For Q2 2024, the operating revenue was CNY 80.43 billion, a decrease of 2.39% year-on-year, and net profit was CNY 13.62 billion, down 7.14% year-on-year and 14.25% quarter-on-quarter [1] Coal Business - The company produced 163 million tons of commodity coal in H1 2024, an increase of 1.6% year-on-year, and sold 230 million tons, up 5.4% year-on-year [1] - The sales price for annual long-term contracts was CNY 490 per ton, down 2% year-on-year, while the monthly long-term contract price was CNY 725 per ton, down 12% year-on-year [1] - The cost of self-produced coal was CNY 191.7 per ton, an increase of 2.0% year-on-year, primarily due to rising labor costs [1] Power Generation - The company generated 104.04 billion kWh of electricity in H1 2024, an increase of 3.8% year-on-year, with sales volume reaching 97.89 billion kWh, up 3.9% year-on-year [2] - The revenue from power generation was CNY 44.35 billion, a slight increase of 0.4% year-on-year, while the cost was CNY 37.27 billion, up 1.4% year-on-year [2] Transportation and Chemical Business - The transportation segment reported a slight increase in profit, with a gross profit of CNY 10.17 billion, up 0.8% year-on-year [2] - The coal chemical segment contributed revenue of CNY 2.54 billion, with a gross profit of CNY 0.176 billion, reflecting a decline in profitability due to scheduled maintenance [2] Capacity Expansion - The company is actively working on coal resource succession and capacity increase, with several mining licenses being updated and new projects progressing [2] Profit Forecast - The report adjusts the profit forecast for 2024-2026, predicting net profits of CNY 57.8 billion, CNY 59.9 billion, and CNY 62.0 billion respectively, with corresponding P/E ratios of 13.9, 13.5, and 13.0 [2]