HTSC·2025-10-29 05:09Investment Rating - The investment rating for the company is "Buy" for both A-shares and H-shares, with target prices of RMB 9.47 and HKD 7.33 respectively [6]. Core Views - The report highlights strong profitability in coal power generation and emphasizes the company's high dividend value, projecting a dividend payout ratio of 58.8% for 2024 and a potential dividend yield of 5.37% for A-shares and 7.55% for H-shares in 2025 [1][4]. Revenue and Profit Analysis - In Q3 2025, the company reported revenue of RMB 60.943 billion, a year-over-year decrease of 7.09% but a quarter-over-quarter increase of 17.88%. The net profit attributable to shareholders was RMB 5.579 billion, reflecting a year-over-year increase of 88.54% and a quarter-over-quarter increase of 30.07% [1]. - For the first nine months of 2025, the company achieved revenue of RMB 172.975 billion, down 6.19% year-over-year, while the net profit attributable to shareholders was RMB 14.841 billion, up 42.52% year-over-year [1]. Coal Power Performance - The total profit per kilowatt-hour for coal power increased by 2.8 fen to 5.1 fen year-over-year in the first nine months of 2025, with Q3 2025 showing a total profit of 6.0 fen per kilowatt-hour, up 3.6 fen year-over-year and 1.5 fen quarter-over-quarter [2]. - The decrease in the benchmark coal price significantly contributed to the profit increase, with a 148% year-over-year rise in profit mainly due to a reduction in coal prices [2]. New Energy Sector Insights - In Q3 2025, the company added 569.14 MW of new wind and solar capacity, a significant decrease from the 6262.91 MW added in the first half of 2025. The profit from wind energy decreased by 38.5% year-over-year, while solar energy profits increased by 25.2% due to higher installation rates [3]. - The report notes that the decline in electricity prices has negatively impacted the profit per kilowatt-hour for wind energy, which fell by 5.9 fen year-over-year [3]. Profit Forecast and Valuation - The report adjusts the company's asset impairment loss expectations for 2025-2027 down by approximately 44.8% to 44.9%, leading to an upward revision of net profit forecasts for the same period by 11.7% to 10.5% [4]. - The estimated net profit for 2025 is projected at RMB 14 billion, with a price-to-earnings ratio of 20.0x for new energy and a price-to-book ratio of 1.05x, resulting in a target market value of RMB 148.7 billion [4][17].