Guotai Junan Securities·2024-09-01 07:42Investment Rating - The investment rating for China Shenhua (601088) is "Buy" [3][7][12] Core Views - The coal sector's market share continues to increase, with expected capacity growth in the future. The company has a strong cash flow and stable profits, with an anticipated annual dividend payout ratio of around 75% [6][7]. Summary by Sections Financial Performance - In H1, the company achieved operating revenue of 168.08 billion yuan, a year-on-year decrease of 0.8%. Net profit was 29.50 billion yuan, down 11.3% year-on-year. Q2 revenue was 80.43 billion yuan, a decline of 2.39% year-on-year, while net profit for the same period was 13.62 billion yuan, down 7.14% year-on-year, aligning with market expectations [7]. - The company maintains EPS forecasts for 2024-2026 at 3.08, 3.09, and 3.19 yuan, respectively, and has raised the target price to 47.77 yuan, an increase of 3.89 yuan [7]. Coal Production and Sales - In H1, the company produced 163 million tons of coal, a year-on-year increase of 1.6%, outperforming the national decline of 1.7%. Sales volume reached 229 million tons, up 5.4% year-on-year, with a continued increase in market share [7]. - The average selling price of self-produced coal (excluding tax) was 566 yuan per ton, a decrease of 35 yuan per ton, or 5.8% year-on-year. The unit production cost was 191.7 yuan per ton, a slight increase of 2% year-on-year [7]. Power Generation and Renewable Energy - The company generated 104.04 billion kWh of electricity in H1, a year-on-year increase of 3.8%. Total electricity sales reached 97.89 billion kWh, up 3.9% year-on-year, with market-based transactions accounting for approximately 97.8% of total sales [7]. - The average selling price of electricity was 404 yuan per MWh, down 3.3% year-on-year [7]. Financial Health - As of the end of the reporting period, the company had cash on hand of 186.9 billion yuan, with a debt-to-asset ratio of only 29.79%. The operating cash flow for H1 was 52.6 billion yuan, significantly exceeding net profit [7]. - The company plans capital expenditures of 36.8 billion yuan for the year, with 12.4 billion yuan invested in H1 [7].