NORTHEAST SECURITIES·2025-08-06 07:59Investment Rating - The report initiates coverage with a "Buy" rating for the company [12]. Core Views - The company experienced a decline in revenue and net profit in the first half of 2025, with revenue at 42.854 billion HKD, down 2.79% year-on-year, and net profit at 5.624 billion HKD, down 5.49% year-on-year [1][2]. - Despite short-term performance pressures, the company maintains growth in Hong Kong, with related business profits increasing by 6% to 45.68 billion HKD [2]. - The company is focusing on long-term investment value through stable cash flow from core businesses and exploring opportunities in the rapidly evolving energy transition market [4]. Financial Summary - The company reported a cash inflow of 7.1 billion HKD in the first half of 2025, a decrease of 9 billion HKD year-on-year, primarily due to a decline in EBITDAF and unfavorable working capital changes [3]. - Non-maintenance capital expenditures reached 7 billion HKD, mainly for projects in Hong Kong and renewable energy initiatives in mainland China [3]. - The company plans to allocate capital based on risk-return principles and geographic selectivity, with a five-year development plan in Hong Kong valued at 52.9 billion HKD [4]. Earnings Forecast - Projected revenues for 2025-2027 are 90.202 billion HKD, 91.221 billion HKD, and 92.144 billion HKD, respectively, with corresponding net profits of 11.194 billion HKD, 11.610 billion HKD, and 11.985 billion HKD [4][5]. - The expected price-to-earnings ratios for 2025-2027 are 15.12, 14.58, and 14.12, respectively [4].