GUOTAI HAITONG SECURITIES·2025-08-29 09:36Investment Rating - The report maintains a "Buy" rating for China Power (2380) [6][10]. Core Views - The company is expected to benefit from the recovery in thermal and wind power, compensating for the decline in hydropower and photovoltaic segments. The report anticipates a profit of 25.9 billion RMB attributable to ordinary shareholders for the first half of 2025, reflecting a year-on-year increase of 0.65% [2][10]. Financial Summary - Total revenue for 2023 is projected at 47.058 billion RMB, with a year-on-year growth of 5.3%. The revenue is expected to reach 54.213 billion RMB in 2024, followed by a decline to 50.610 billion RMB in 2025, and then a recovery to 53.830 billion RMB in 2026 and 56.813 billion RMB in 2027 [4]. - Gross profit is forecasted to increase from 5.739 billion RMB in 2023 to 9.893 billion RMB in 2025, with net profit expected to rise from 2.660 billion RMB in 2023 to 3.607 billion RMB in 2025 [4]. - The report estimates the company's PE ratio to decrease from 12.3 in 2023 to 9.9 in 2025, indicating a potential undervaluation [4]. Segment Performance - Thermal power is expected to see a net profit of 20.3 billion RMB in 2025, a year-on-year increase of 5 billion RMB, driven by a slight rebound in coal prices [10]. - Wind power is projected to achieve a net profit of 21.2 billion RMB, with an increase in utilization hours contributing positively [10]. - Hydropower and photovoltaic segments are expected to face challenges, with net profits of 5.5 billion RMB and 7.2 billion RMB respectively, reflecting declines due to reduced utilization hours [10]. Valuation and Target Price - The report suggests a target price of 3.63 HKD for the stock, based on a PE ratio of 11.5 for 2025, which reflects a premium valuation due to the anticipated integration of hydropower assets [10][12].