Investment Rating - The report initiates coverage with a "Buy" rating for China General Nuclear Power Corporation (CGN Power) [2][8] Core Views - CGN Power is the sole operating platform for nuclear power generation under China General Nuclear Group, showing stable profit growth in recent years. The company was established in March 2014 and listed on the Hong Kong Stock Exchange and Shenzhen Stock Exchange in December 2014 and August 2019, respectively. The controlling shareholder is China General Nuclear Group, which held a combined stake of 58.89% in A-shares and H-shares by the end of 2024 [7][23]. - Nuclear power is crucial for achieving carbon neutrality goals, with China accelerating its nuclear power development. The company has seen a compound annual growth rate (CAGR) of 7.4% in revenue and 2.7% in net profit from 2019 to 2024 [7][24]. - The company is entering a phase of intensive construction and commissioning of nuclear power units, with 20 units under management as of June 2025, representing a potential increase of approximately 76% over the current operational capacity of 31.80 GW [7][33]. - Financial costs have been decreasing due to lower domestic interest rates, and the company has a robust cash flow to support capital expenditures and dividends. The operating cash flow net amount for 2024 is projected to be 38 billion yuan, a year-on-year increase of 14.8%, fully covering investment expenditures and dividends [7][8]. - The report forecasts earnings per share (EPS) of 0.21, 0.23, and 0.24 yuan for 2025-2027, with corresponding price-to-earnings (PE) ratios of 13, 12, and 11 times. The estimated reasonable market value for the H-shares is 186.6 billion HKD, indicating a potential upside of 25.2% [8][24]. Financial Data and Profit Forecast - Revenue (in million yuan) is projected to be 82,549 in 2023, 86,804 in 2024, and 87,245 in 2025, with growth rates of 0%, 5%, and 1% respectively. Net profit attributable to shareholders is expected to be 10,725 million in 2023, 10,814 million in 2024, and 10,753 million in 2025, with growth rates of 8%, 1%, and -1% respectively [6]. - The company’s dividend per share has increased from 0.0578 HKD in 2016 to 0.1032 HKD in 2024, with a dividend payout ratio consistently above 40% for six consecutive years [7][8]. Key Assumptions - Installed capacity is expected to reach 32.92 million kW, 35.24 million kW, and 37.64 million kW for 2025-2027. The on-grid electricity volume is projected to be 234.8 billion kWh, 243.9 billion kWh, and 255.5 billion kWh for the same period [9]. - The on-grid electricity price is anticipated to be 0.401, 0.3994, and 0.3987 yuan per kWh for 2025-2027 [9].
中广核电力（01816）：长期成长确定性强，分红稳健股息回报高