SPIC GECL(SZ:000875) Guoxin Securities·2026-02-10 12:15Investment Rating - The report assigns an "Outperform" rating to the company, marking its first coverage [5]. Core Insights - The company is positioned as the only green hydrogen energy platform under the State Power Investment Corporation, with a dual-track development strategy focusing on "New Energy +" and "Green Hydrogen Energy" [1][13]. - The company has a total installed capacity of 14.44 million kilowatts as of 2024, with a significant portion (76.9%) coming from wind and solar energy [1][17]. - The profitability of coal-fired power is expected to stabilize due to improvements in the pricing mechanism, transitioning from a single pricing model to a two-part pricing model, which will reduce revenue volatility [1][38]. - The company is actively developing its green hydrogen business, leveraging abundant wind and solar resources to produce green hydrogen and ammonia, with several projects already in operation or under construction [2][14]. Financial Projections - The projected net profits for the company from 2025 to 2027 are estimated at 533 million, 809 million, and 907 million yuan, respectively, with a significant year-on-year growth rate expected in 2026 [3][4]. - The earnings per share (EPS) for the same period are forecasted to be 0.15, 0.22, and 0.25 yuan, with corresponding price-to-earnings (PE) ratios of 47.1, 31.0, and 27.7 [3][4]. - The absolute valuation of the company's stock is estimated to be between 7.89 and 8.24 yuan, indicating a premium of 14% to 19% over the current stock price of 6.92 yuan [3][5]. Revenue and Profitability - The company's revenue is projected to decline slightly in the coming years, with a forecasted revenue of 12.69 billion yuan in 2025, reflecting a decrease of 7.6% from the previous year [4]. - The net profit margin is expected to experience fluctuations, with a significant drop in 2025 due to various market factors, but is anticipated to recover in subsequent years [3][24]. - The company’s operating cash flow is showing signs of improvement, with a net cash flow of 5.16 billion yuan in the first three quarters of 2025, indicating a positive trend in cash management [30][32]. Market Trends - The renewable energy market is advancing towards a more market-oriented pricing mechanism, which is expected to enhance the profitability of new energy projects [2][60]. - The company is well-positioned to benefit from the increasing demand for green hydrogen and ammonia, driven by international regulations and market trends favoring low-carbon solutions [2][54].