Investment Rating - The report assigns an "Accumulate" rating for the company, indicating a positive outlook for the stock over the next six months [8]. Core Views - The company's short-term performance is impacted by declining electricity prices, but it plans to inject Huizhou Nuclear Power to solidify its future foundation [7][8]. - Despite short-term challenges, the long-term growth path of the company is clear, supported by a robust pipeline of nuclear projects and favorable industry trends [8]. Financial Summary - For 2023A, the company is projected to achieve a revenue of 82,549 million yuan, with a slight decline of 0.3% year-on-year. The net profit attributable to shareholders is expected to be 10,725 million yuan, reflecting a growth of 7.6% year-on-year [1]. - The company anticipates revenues of 86,804 million yuan in 2024A and 86,639 million yuan in 2025E, with net profits of 10,814 million yuan and 9,978 million yuan respectively [1][8]. - The company's return on equity (ROE) is projected to be 10.3% in 2023A, declining to 8.6% by 2025E [1]. Business Performance - In the first half of 2025, the company reported a revenue of 39,167 million yuan, down 0.53% year-on-year, and a net profit of 5,952 million yuan, down 16.30% year-on-year [1][2]. - The company's nuclear power generation revenue showed a slight increase of 0.93% year-on-year, primarily due to a growth in electricity generation, which offset the decline in market prices [3][4]. - The average market price of electricity decreased by approximately 8.23% compared to the same period in 2024, significantly affecting profitability [3]. Project Development - The company has a strong pipeline of nuclear projects, with 28 operational nuclear units and 20 under construction, providing a solid foundation for long-term growth [4][7]. - The planned acquisition of an 82% stake in Huizhou Nuclear Power for 9.375 billion yuan will enhance the company's project portfolio and growth prospects [7][8].

Core Viewpoint - The company reported a decline in revenue and net profit for the first half of 2025, primarily due to falling electricity prices and increased tax expenses, despite a slight increase in nuclear power generation revenue [1][2][3]. Financial Performance - In H1 2025, the company achieved operating revenue of 39.167 billion yuan, a year-on-year decrease of 0.53% [1] - The net profit attributable to shareholders was 5.952 billion yuan, down 16.30% year-on-year [1] - The basic earnings per share were 0.12 yuan, reflecting a 16.31% decline compared to the previous year [1] - The return on equity (ROE) was 4.88%, a decrease of 1.19 percentage points year-on-year [1] Business Segments - Nuclear power generation revenue in H1 2025 was 30.658 billion yuan, a slight increase of 0.93% year-on-year, supported by a 6.93% increase in electricity generation [2] - The construction and design services segment generated revenue of 7.612 billion yuan, down 4.83% year-on-year [2] - The average market electricity price decreased by approximately 8.23% compared to the same period in 2024, significantly impacting profitability [2][3] Profitability Challenges - The gross margin for the core electricity sales business fell by 5.44 percentage points to 43.29% due to declining electricity prices [3] - Income tax expenses increased by 17.91% to 2.490 billion yuan, influenced by the expiration of tax incentives for certain nuclear power units [3] - The combination of these factors led to a temporary decline in the company's profitability [3] Project Development - The company has a robust pipeline of nuclear projects, with 28 operational units and 20 under construction, providing a solid foundation for long-term growth [3] - Recent approvals for new projects, including the Taishan Phase II and Fangchenggang Phase III, enhance the company's project portfolio [3] Strategic Acquisitions - The company plans to acquire an 82% stake in Huizhou Nuclear Power for 9.375 billion yuan, which includes several in-progress projects expected to contribute to future revenue [4] - This acquisition is expected to clarify the company's long-term growth trajectory by expanding its project base [4] Industry Outlook - The nuclear power industry is expected to grow, driven by high utilization hours and favorable pricing trends, despite short-term pressures from electricity price declines [5] - The company forecasts revenues of 86.639 billion yuan, 90.498 billion yuan, and 96.507 billion yuan for 2025-2027, with corresponding net profits of 9.978 billion yuan, 10.431 billion yuan, and 11.429 billion yuan [5]

Investment Rating - The report maintains a "Buy" rating for China Nuclear Power (601985.SH) [5] Core Views - The company demonstrates robust profitability in nuclear power and has initiated a mid-term dividend for the first time, reflecting management's confidence in long-term value [9][10] - The growth in revenue is driven by an increase in operational nuclear power units and a significant rise in electricity generation from renewable energy sources [3][4] Financial Summary - For 2023A, the company expects revenue of 74,957 million yuan, with a year-on-year growth rate of 5.2%. By 2027E, revenue is projected to reach 97,135 million yuan, reflecting a growth rate of 10.4% [1] - The net profit attributable to the parent company is forecasted to be 10,624 million yuan in 2023A, with a growth rate of 17.9%. By 2027E, it is expected to increase to 11,230 million yuan, with a growth rate of 9.7% [1] - The company reported a diluted EPS of 0.52 yuan in 2023A, projected to rise to 0.55 yuan by 2027E [1] Operational Performance - In the first half of 2025, the company achieved a revenue of 40,973 million yuan, a year-on-year increase of 9.43%. The net profit attributable to the parent company was 5,666 million yuan, a decrease of 3.66% year-on-year [1][2] - The operational efficiency of nuclear power units is highlighted, with an average utilization of approximately 4,000 hours, surpassing the national average of 3,882 hours [3] Business Segments - The nuclear power segment showed resilience with a profit of 53,220 million yuan in the first half of 2025, up 9.48% year-on-year, despite challenges in the renewable energy segment [4] - The renewable energy segment's profit declined due to lower market prices for wind and solar power, impacting overall net profit [4] Future Growth Prospects - The company has a strong pipeline with 19 nuclear units under construction or approved, ensuring a solid foundation for long-term growth [9] - The report anticipates revenue growth of 7.7%, 5.8%, and 10.4% for the years 2025 to 2027, respectively, alongside net profit growth of 11.1%, 5.0%, and 9.7% [10]