Investment Rating - The report initiates coverage with a "Buy" rating for Huaneng International Power Co., Ltd. [2] Core Insights - The company benefits from declining coal prices, leading to significant improvements in profitability. In the first half of 2025, the company reported a revenue of RMB 1120.32 billion, a year-on-year decrease of 5.70%, while net profit attributable to shareholders increased by 23.19% to RMB 95.78 billion [6][14] - The expansion of installed capacity in renewable energy is driving growth. By the end of 2024, the controllable power generation capacity reached 145,125 MW, with a clean energy share of 35.82% [6][23] - The introduction of capacity pricing enhances profitability stability. Recent policies in Gansu province set a capacity price of RMB 330 per kW per year, which helps recover fixed capital expenditures for coal power companies [6][39] - Improved cash flow and increased dividends reflect the company's long-term value. The operating cash flow for 2024 is projected to reach RMB 505 billion, a year-on-year increase of 11% [6][31] Summary by Sections 1. Performance Recovery from Declining Coal Prices - The company is the largest listed power generation company in China, with a revenue of RMB 245.6 billion in 2024, down 3% year-on-year, and a net profit of RMB 102 billion, up 22% [14][16] 2. Continuous Expansion of Renewable Energy Capacity - The company has significantly increased its wind and solar power installations, with wind power generation capacity reaching 18,109 MW and solar power capacity at 19,836 MW by the end of 2024 [23][28] 3. Cash Flow Optimization and Dividend Increases - The company has seen a steady improvement in cash flow, with a projected operating cash flow of RMB 307 billion for the first half of 2025, a 30% increase year-on-year [31][35] 4. Profit Forecast and Valuation - The company is expected to generate revenues of RMB 241.48 billion, RMB 243.10 billion, and RMB 247.54 billion for 2025, 2026, and 2027 respectively, with net profits of RMB 130.46 billion, RMB 138.47 billion, and RMB 147.01 billion [41][42]
华能国际电力股份（00902）：容量电价提升盈利稳定性，成本下降助力估值修复