FUNENG CO.,LTD(600483) Guoxin Securities·2024-10-31 10:02Investment Rating - The investment rating for the company is "Outperform the Market" [5][14]. Core Views - The company's revenue slightly increased, while the net profit attributable to shareholders grew year-on-year. In the first three quarters of 2024, the company achieved a revenue of 10.485 billion yuan (+1.22%) and a net profit of 1.773 billion yuan (+8.38%) [1][7]. - The company has sufficient project resources on hand, with new approvals for combined heat and power projects expected to enhance its thermal power capacity further [2][13]. - The company is gradually advancing its offshore wind power projects, with expectations for new project resources to be secured [2][13]. Summary by Sections Financial Performance - In Q3 2024, the company reported a revenue of 3.820 billion yuan (-4.13%) and a net profit of 585 million yuan (-16.60%). The decline in revenue was primarily due to a decrease in power generation [1][7]. - The total power generation for the first three quarters was 17.623 billion kWh (+0.37%), with grid-connected power generation at 16.758 billion kWh (+0.47%) [1][7]. Project Developments - The Fujian Development and Reform Commission approved the second phase of the combined heat and power project in August 2024, which will add 2×650MW supercritical coal-fired units [2][13]. - The company has a total of 2.62 million kW of combined heat and power projects under construction and planned, expected to be operational between 2026 and 2027 [2][13]. Profitability and Valuation - The company's gross margin improved to 21.99%, an increase of 3.25 percentage points, mainly due to a decrease in coal prices [11]. - The estimated net profit for 2024-2026 is projected to be 2.83 billion yuan, 3.03 billion yuan, and 3.28 billion yuan, respectively, with corresponding EPS of 1.06, 1.14, and 1.23 yuan [14][16]. - The current stock price corresponds to a PE ratio of 9.0, 8.4, and 7.8 for the years 2024, 2025, and 2026, respectively [14][16]. Market Position - The company's reasonable market value is estimated to be between 25.5 billion and 28.3 billion yuan, with a corresponding stock price range of 9.57 to 10.64 yuan per share, indicating a potential premium of 0% to 11% over the current stock price [14][16].