CHINA POWER(02380) 华源证券·2024-05-22 09:32Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook on its stock performance [3]. Core Insights - The recent increase in shareholding by CITIC Financial Asset Management to 5% reflects market recognition of the company's value, highlighting its high growth and high dividend attributes in the context of a recovering Hong Kong stock market [3]. - The company has a strong dividend record, with a projected dividend yield of 5.5% if it maintains a 50% payout ratio in 2024 [3]. - The company is undergoing a significant transformation towards clean energy, with successful divestments of old coal power units and rapid expansion in renewable energy capacity, which is expected to enhance profitability [3][4]. - The company faced challenges in 2023 due to historically low water levels affecting hydroelectric output, but early 2024 indicators show a strong recovery across all operational metrics [4]. - Profit forecasts for 2024-2026 indicate a substantial increase in net profit, with projected figures of 48.01 billion, 69.30 billion, and 80.29 billion RMB respectively, suggesting a favorable valuation with PE ratios of 8, 6, and 5 times [4]. Summary by Sections Shareholding and Market Recognition - CITIC Financial Asset Management increased its stake in the company to 5%, purchasing 12.65 million shares at an average price of 3.5243 HKD per share, totaling approximately 44.58 million HKD [3]. Financial Performance and Projections - The company reported a net profit of 2.648 billion RMB in 2023, with projections for 2024 showing a significant increase to 4.801 billion RMB, reflecting a growth rate of 80.49% [5]. - The total revenue for 2024 is expected to reach 56.189 billion RMB, marking a year-on-year growth of 26.9% [5]. Operational Improvements - The company has optimized its asset quality by divesting from loss-making coal power units and expanding its renewable energy portfolio, with operational capacity in solar and wind energy reaching 15.149 million kW and 12.016 million kW respectively by the end of 2023 [3][4].