Report Summary 1. Report Industry Investment Ratings - Steel: No specific overall industry investment rating is provided, but the strategy for steel is "oscillating weakly" [2] - Iron Ore: The strategy is "oscillating weakly" [4] - Coking Coal and Coke: Coking coal is expected to "oscillate", and coke is also expected to "oscillate" [6] - Thermal Coal: No specific investment strategy is provided [7] 2. Core Views - Steel market has low - price and high - volume trading, with steel prices rebounding slightly. However, due to weak real estate, potential weakening of domestic demand in infrastructure and consumer - related manufacturing in the fourth quarter, and the need to exchange external demand with low prices, further production cuts are needed for inventory reduction [1] - Iron ore prices are under downward pressure due to falling steel mill profitability, reduced iron - water production, and a significant increase in iron ore arrivals [3] - Driven by the sharp rise in thermal coal prices, coking coal and coke prices are oscillating and rebounding. The supply of coking coal and coke is tight, and the demand shows certain resilience [5][6] - Thermal coal prices continue to rise. The downstream non - power demand is strong, and prices are expected to be firm in the short term due to winter storage expectations and difficulty in inventory accumulation [7] 3. Summary by Related Catalogs Steel - **Market Analysis**: The closing price of the rebar futures main contract is 3037 yuan/ton, and that of the hot - rolled coil futures main contract is 3256 yuan/ton. The overall spot trading volume of steel is average, with the national building materials trading volume at 11.03 tons, showing an increase compared to the previous day and a good week - on - week performance [1] - **Supply and Demand Logic**: The weekly output of the five major steel products is 856.74 tons, a week - on - week decrease of 18.55 tons. All product outputs have declined. The real estate remains weak, and there is pressure on the domestic demand of infrastructure and consumer - related manufacturing in the fourth quarter. The inventory reduction of the five major steel products has slowed down [1] - **Strategy**: Unilateral trading is "oscillating weakly", and there are no strategies for inter - period, inter - variety, spot - futures, and options trading [2] Iron Ore - **Market Analysis**: Iron ore futures prices are oscillating. The prices of mainstream imported iron ore varieties have risen slightly. The trading volume of national main - port iron ore is 115.4 tons, a 6.07% increase compared to the previous day, and the trading volume of forward - looking spot is 158.9 tons, a 6.00% increase. The daily average iron - water output of 247 steel mills is 234.22 tons, a decrease of 2.14 tons compared to the previous period, and the steel mill profitability rate is 39.83%, a 5.19% decrease [3] - **Supply and Demand Logic**: The apparent demand for steel has dropped significantly this week, and the steel mill profitability rate has further decreased. The iron ore arrival volume has increased significantly, and the iron - water output has decreased, resulting in reduced demand [3] - **Strategy**: Unilateral trading is "oscillating weakly", and there are no strategies for inter - period, inter - variety, spot - futures, and options trading [4] Coking Coal and Coke - **Market Analysis**: Affected by the rise in thermal coal prices and market sentiment, the coking coal and coke futures prices are oscillating and rebounding. The import volume of Mongolian coking coal has recovered, and the trading volume is average [5][6] - **Logic and Views**: For coking coal, the domestic supply recovery is slow, and imported coal is abundant, with a slightly loose overall situation but a lower inventory accumulation rate than last year. The demand is supported by the successful third - round price increase of coke. For coke, the supply is tight due to profit losses, and the demand shows certain resilience after the third - round price increase [6] - **Strategy**: Coking coal is expected to "oscillate", and coke is also expected to "oscillate". There are no strategies for inter - period, inter - variety, spot - futures, and options trading [6] Thermal Coal - **Market Analysis**: In the production areas, coal prices are rising, and the non - power demand is strong. At the ports, the trading volume of market coal is low, but traders are reluctant to sell due to rising coal mine prices and low port inventories. The price of imported coal is also rising [7] - **Demand and Logic**: In the short term, prices are oscillating and rising due to tight supply in production areas. In the long - term, the supply pattern is loose, but with the approaching of the winter heating season and strong non - power demand, attention should be paid to overall consumption and inventory replenishment [7] - **Strategy**: No specific strategy is provided [7]

Core Viewpoint - In the first three quarters of 2025, the company achieved operating revenue of 95.872 billion yuan, a year-on-year decrease of 9.72%, while net profit attributable to shareholders was 6.437 billion yuan, a year-on-year increase of 15.87%. The decline in operating revenue was mainly due to a decrease in on-grid electricity and electricity prices, while the increase in net profit was driven by lower coal prices improving fuel costs [1][2][3]. Financial Performance - The company reported operating revenue of 95.872 billion yuan in the first three quarters of 2025, down 9.72% year-on-year. Net profit attributable to shareholders was 6.437 billion yuan, up 15.87% year-on-year. The non-recurring net profit was 6.211 billion yuan, an increase of 20.74% year-on-year. The quarterly net profit was 2.533 billion yuan, reflecting a growth of 20.32% year-on-year [2][3]. - The weighted return on equity was 12.73%, an increase of 1.87 percentage points year-on-year, with basic earnings per share at 0.54 yuan, up 22.73% year-on-year [2]. Cost and Profitability - The decrease in operating revenue was primarily due to a decline in on-grid electricity and electricity prices. However, net profit growth was supported by lower coal prices, which improved fuel costs. The financial expenses for the first three quarters were 2.414 billion yuan, a decrease of 15.6% year-on-year due to reduced financing costs [3][4]. - The management expense ratio and financial expense ratio were 1.47% and 2.52%, with changes of +0.12 and -0.18 percentage points year-on-year, respectively [3]. Electricity Generation and Market Dynamics - The total electricity generation for the first three quarters was 201.329 billion kWh, a decrease of approximately 5.87% year-on-year, while on-grid electricity was 189.243 billion kWh, down about 5.94% year-on-year. The decline in on-grid electricity was attributed to the growth of renewable energy installations in the region, which squeezed the output capacity of thermal power [4]. - The average on-grid electricity price was 509.55 yuan per MWh, a decrease of approximately 2.76% year-on-year [4]. Future Outlook - Recent rebounds in coal prices are noted, but the company believes that the upward potential for coal prices is limited due to energy supply policies and downstream demand. The profitability of thermal power is expected to remain stable, and operational performance is anticipated to grow steadily. Projected net profits for 2025 to 2027 are estimated at 7.533 billion yuan, 7.848 billion yuan, and 8.128 billion yuan, respectively [4].

Report Industry Investment Rating - Not provided Core Viewpoint - In the short term, the coal market will maintain a relatively strong pattern due to demand support and sentiment transmission. In the long term, the supply remains in a loose pattern, and attention should be paid to non - power coal consumption and restocking [2] Summary by Related Catalogs Market Analysis - **Futures and Spot Prices**: As of October 17, the Yulin 5800 - kcal index was 613.0 yuan/ton, up 46.0 yuan/ton week - on - week; the Ordos 5500 - kcal index was 555.0 yuan/ton, up 51.0 yuan/ton week - on - week; the Datong 5500 - kcal index was 625.0 yuan/ton, up 50.0 yuan/ton week - on - week. The CCI Import 4700 index was 72.5 dollars/ton, up 2.8 dollars/ton week - on - week, and the CCI Import 3800 index was 56.3 dollars/ton, up 2.3 dollars/ton week - on - week [1][5] - **Port Inventory**: As of October 17, the total inventory of northern ports was 2183.0 million tons, a decrease of 142 million tons from last week [1] - **Power Plant Inventory**: As of October 17, the coal inventory of six coastal power plants was 1388.4 million tons, a decrease of 34.7 million tons from last week; the average available days were 17 days, the same as last week; the daily coal consumption was 83.5 million tons, a decrease of 0.8 million tons from last week [1] - **Freight Index**: As of October 17, the Ocean Coal Freight Index (OCFI) was 1046.24 points, up 143.23 points. The Baltic Dry Index (BDI) was 2069.00 points, up 23.00 points, a 1.12% increase [1] Supply - After the holiday, mines resumed production, but safety inspections became stricter, affecting the rapid release of production [8] Consumption - The terminal demand of downstream metallurgy and chemical industries continued to be released. The purchase prices of large groups increased, and the transportation demand of platform traders increased. There were queues of coal - hauling trucks at some mines, and the coal mine inventory decreased [2][10] Inventory - Due to good downstream demand, the coal mine inventory decreased [13]

Economic Activity - The China High-Frequency Economic Activity Index (YHEI) as of September 9, 2025, is 0.98, a decrease of 0.06 from September 2 [1][3] - Key industrial indicators such as the "coastal coal freight index" and "import dry bulk freight index" have declined, with the coastal coal freight index at 0.71, the lowest since June [1][3] Price Indices - The Consumer Price Index (CPI) in August fell by 0.4% year-on-year, with core CPI rising by 0.9%, an increase of 0.1 percentage points from the previous month [42] - Food prices saw a significant decline, with fresh vegetable and pork prices dropping by 15.2% and 16.1% year-on-year, respectively [42] - The Producer Price Index (PPI) decreased by 2.9% year-on-year, with the decline in production material prices narrowing to 3.2% [42][2] Monetary Policy - As of September 9, 2025, the central bank net withdrew 948.8 billion yuan through open market operations, with a reverse repurchase rate of 1.4% [5][6] Interest Rates - The overnight interbank rate rose by 12 basis points to 1.48%, while the seven-day repo rate increased by 3 basis points to 1.49% [9][10] - The yields on 1-year, 5-year, and 10-year government bonds increased by 3.46, 1.35, and 4.74 basis points, respectively [14] Industrial Sector - As of September 9, 2025, steel billet prices increased by 1.69% week-on-week, while cement prices decreased by 1.01% [23][24] - The operating rate of short-process steel mills remained stable at 69.79%, while long-process steel mills saw a decline to 50.00% [23] Shipping Sector - The China Coastal Bulk Freight Index fell by 59.07 points to 994.29 points, while the Baltic Dry Index rose by 93 points to 2079 points [31] Real Estate Market - In the week ending September 9, 2025, new and second-hand home transaction areas in first-tier cities decreased by 24.64% and 4.17%, respectively [35][36] Global Economic Indicators - The US dollar index decreased by 0.54 points to 97.77, while the RMB appreciated by 228 basis points to 7.1248 against the dollar [44][45]

Core Viewpoint - In the first half of 2025, the company achieved operating revenue of 59.953 billion yuan, a year-on-year decrease of 8.98%, while net profit attributable to shareholders increased by 13.15% to 3.904 billion yuan. The decline in revenue was mainly due to a decrease in power generation, lower on-grid electricity prices, and optimization of coal trading models. The increase in net profit was primarily driven by the decline in thermal coal prices, which improved fuel costs [1][2][3] Financial Performance - The company's fuel costs in the first half of 2025 amounted to 37.952 billion yuan, a year-on-year decrease of 13.28%. The average price of standard coal for the company was 850.74 yuan per ton, down approximately 12.98% year-on-year [1][3] - The management expenses for the first half of 2025 were 0.829 billion yuan, with a management expense ratio of 1.38%, an increase of 0.12 percentage points year-on-year. Financial expenses were 1.635 billion yuan, with a financial expense ratio of 2.73%, a decrease of 0.18 percentage points year-on-year. The total period expense ratio was 4.12%, a decrease of 0.05 percentage points year-on-year [1][3] - The company reported investment income of 2.481 billion yuan in the first half of 2025, a year-on-year increase of approximately 9.25%, mainly due to increased earnings from affiliated companies [3] Operational Metrics - As of August 2025, the company's controllable installed capacity was 77.4446 million kilowatts, with coal power, gas power, and hydropower capacities at 54.404 million, 20.58 million, and 2.46 million kilowatts, respectively. The company added 17.62 million kilowatts of installed capacity, primarily due to asset injections from the parent company [4] - The total power generation in the first half of 2025 was 120.621 billion kilowatt-hours, a year-on-year decrease of approximately 6.41%, while the on-grid electricity volume was 113.289 billion kilowatt-hours, a decrease of approximately 6.46% year-on-year. The average utilization hours of the company's power generation units were 1,595 hours, a decrease of 115 hours year-on-year [4] - The average on-grid electricity price in the first half of 2025 was 516.80 yuan per megawatt-hour, a year-on-year decrease of approximately 1.44% [4] Future Outlook - The company expects net profits attributable to shareholders for 2025 to 2027 to be 6.901 billion yuan, 7.185 billion yuan, and 7.417 billion yuan, respectively. The corresponding earnings per share (EPS) are projected to be 0.51 yuan, 0.53 yuan, and 0.55 yuan [5]

Core Viewpoint - In the first half of 2025, the company reported a revenue of HKD 50.267 billion, a year-on-year decrease of 1.7%, and a net profit attributable to shareholders of HKD 7.872 billion, down 15.9% year-on-year. The decline in revenue was mainly due to a decrease in the on-grid electricity price of subsidiary power plants, while the drop in net profit was attributed to significant declines in other gains [1][2][3] Financial Performance - The company's core net profit attributable to shareholders reached HKD 8.278 billion, a slight increase of 0.1% year-on-year. The renewable energy segment contributed HKD 5.637 billion to core net profit, up 1.5%, while the thermal power segment's core net profit was HKD 2.641 billion, down 2.7%. Excluding coal business, the pure thermal power segment achieved a core net profit of HKD 2.788 billion, a significant increase of 20.6% [1][2][3] Revenue Breakdown - The renewable energy business saw a revenue increase driven by a 10% rise in sales volume, reaching HKD 14.5 billion in the first half of 2025. The average benchmark coal price for subsidiary power plants was HKD 824 per ton, down 12% year-on-year, leading to a significant improvement in the cost of coal-fired electricity generation [1][2][3] Installed Capacity and Sales - As of June 2025, the company had a controlling installed capacity of 88.93 million kilowatts, with a rights-based capacity of 78.09 million kilowatts. The thermal power rights-based capacity was 39.14 million kilowatts, accounting for 50.1%. The company added 1.24 million kilowatts of wind power and 3.51 million kilowatts of solar power in the first half of 2025 [2][3] Market Dynamics - The decline in coal prices and the relatively loose power supply and demand led to a decrease in on-grid electricity prices. The on-grid electricity prices for coal, wind, and solar were HKD 391.2, HKD 396.8, and HKD 304.9 per megawatt-hour, respectively, representing year-on-year decreases of 6%, 11%, and 6% [3][4] Future Outlook - The company expects stable profitability in thermal power, with a forecasted net profit attributable to shareholders of HKD 13.748 billion, HKD 13.798 billion, and HKD 14.667 billion for 2025 to 2027. The company maintains a stable dividend policy [4]

Investment Rating - The industry investment rating is "Positive" [2] Core Viewpoints - The report indicates a decline in thermal coal prices, with significant increases in coal inventory at three major ports [5][30] - The average daily coal consumption of the six major power generation groups has decreased month-on-month, while year-on-year growth is observed [39] - Domestic shipping costs have decreased month-on-month, while international shipping costs show mixed trends [49] Summary by Sections 1. Thermal Coal Prices - As of May 9, the price of Shanxi mixed thermal coal at Qinhuangdao is 635 CNY/ton, down 4.80% from the previous month [3][14] - International thermal coal prices have also decreased, with Newcastle coal at 94 USD/ton, down 3.09% month-on-month [17] 2. Production - In March, the monthly coal production from key state-owned mines in Shaanxi, Shanxi, and Inner Mongolia increased month-on-month [23] - The total coal production in March was 44,058.20 million tons, a year-on-year increase of 10.33% [20] 3. Imports - The monthly import volume of coal and lignite in April was 37.83 million tons, a decrease of 2.34% month-on-month [26] - The monthly import of thermal coal in March was 9.18 million tons, an increase of 4.85% month-on-month but a decrease of 30.58% year-on-year [26] 4. Inventory - As of May 9, the total coal inventory at the three major ports reached 15.76 million tons, an increase of 12.73% month-on-month [30] - The average available days of coal inventory for the six major power generation groups increased by 5.11% month-on-month [38] 5. Downstream Demand - The average daily coal consumption of the six major power generation groups was 759,400 tons, a decrease of 0.26% month-on-month [39] - National electricity generation in March increased by 4.06% year-on-year, while thermal power generation decreased by 1.96% [41][48] 6. Freight Rates - Domestic shipping costs from Qinhuangdao to Shanghai decreased by 13.92% month-on-month [49] - International shipping costs from Newcastle to China decreased by 3.79% month-on-month [49]