华润电力：火电盈利逐步释放，新能源装机加速投产

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 24.5, indicating a potential upside of 19% from the current price of HKD 20.6 [3][5]. Core Insights - The company's profitability is gradually improving, with a significant increase in profits from thermal power generation, while renewable energy profits are under pressure due to adverse weather conditions and declining electricity prices [2][3]. - The company plans to accelerate the commissioning of new renewable energy installations, with a target of adding 10 GW of new capacity by the end of the year [2][3]. Financial Performance Summary - For the first half of 2024, the company reported revenue of HKD 51.1 billion, with a net profit of HKD 9.363 billion, reflecting a year-on-year growth of 38.9% [2]. - The thermal power business achieved a profit of HKD 2.7 billion, a substantial increase of 232% year-on-year, driven by a 10.7% decrease in fuel costs [2]. - Renewable energy core business profit decreased by 6.7% to HKD 5.556 billion, impacted by lower wind speeds and electricity prices [2]. - The company’s thermal power sales volume increased by 3.3% year-on-year, and the gross margin for thermal power business improved by 9.6 percentage points [2]. Future Projections - The company expects net profits for 2024, 2025, and 2026 to be HKD 14.782 billion, HKD 16.803 billion, and HKD 18.837 billion respectively, representing year-on-year growth rates of 34%, 14%, and 12% [3][6]. - The projected revenue for 2024 is HKD 106.66 billion, with a slight increase expected in subsequent years [6][7]. Market Position - The company is positioned in a strong market, with most of its power plants located in regions with high electricity demand, which is expected to sustain its profitability [3]. - The company’s governance capabilities are highlighted as a strength, particularly in maintaining leading profitability in the renewable energy sector despite current challenges [3].