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]