Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 7.90 [6]. Core Insights - The company reported a revenue of HKD 54.3 billion for 2025, a decrease of 2.1% year-on-year, while core profit increased by 4% to HKD 6.0 billion, aligning with expectations [1]. - The company is expected to benefit from a stable energy supply and cost-locking mechanisms, which will help maintain profit margins [2]. - The green fuel segment is anticipated to see a profit increase in 2026 due to rising prices and capacity growth [4]. - The company is undergoing a light-asset transformation that is expected to improve free cash flow [5]. Summary by Sections Hong Kong Gas - The gas sales volume in Hong Kong remained stable at 27,181 TJ in 2025, with a slight increase in residential gas consumption offsetting a minor decline in commercial and industrial usage [2]. - The company added 20,000 new customers, supported by the Northern Metropolis Action Plan, which aims to provide over 500,000 residential units over the next 20 years [2]. Mainland City Gas - The sales volume of city gas in mainland China was 36.35 billion cubic meters in 2025, remaining flat year-on-year [3]. - The city gas price differential improved to RMB 0.54 per cubic meter, driven entirely by an increase in residential gas prices [3]. Green Fuel - The production capacity for sustainable aviation fuel (SAF) is expected to reach 770,000 tons by the end of 2025, with significant price increases observed in SAF and hydrotreated vegetable oil (HVO) [4]. - The green methanol strategy aligns with policy cycles, with production expected to start in 2027 [4]. Financial Projections - The company expects net profit attributable to shareholders to be HKD 6.09 billion in 2026, reflecting a 7% increase from 2025 [10]. - The target price of HKD 7.90 represents a 19% premium over the historical average price-to-book ratio of 2.1x [5][29].