Investment Rating - The investment rating for the company is "Buy" and is maintained [9] Core Views - The company's total power generation from its six domestic hydropower stations in the third quarter was approximately 108.47 billion kWh, a decrease of 5.84% year-on-year. Consequently, the company's operating revenue in the third quarter decreased by 7.78% year-on-year. However, through cost reduction and efficiency improvement, the net profit attributable to the parent company in the third quarter decreased by 9.13% year-on-year, with the impact of water inflow on revenue being somewhat smoothed out, resulting in a year-on-year growth of 0.6% in net profit for the first three quarters. The report emphasizes that short-term power generation performance cannot be linearly extrapolated, as water inflow in the Yangtze River basin has improved significantly since the autumn flood began [2][6][10]. Summary by Sections Financial Performance - In the third quarter of 2025, the company achieved operating revenue of 29.044 billion yuan, a year-on-year decrease of 7.78%, and a net profit attributable to the parent company of 15.137 billion yuan, a decrease of 9.13% [6][10]. - The total water inflow for the Wudongde Reservoir in the first three quarters was approximately 83.489 billion cubic meters, a decrease of 6.04% year-on-year, while the Three Gorges Reservoir's water inflow was approximately 298.880 billion cubic meters, a decrease of 4.54% year-on-year [10]. Operational Insights - The company managed to smooth the impact of water inflow on its revenue through cost reduction measures, resulting in a gross profit of 20.478 billion yuan in the third quarter, a decrease of 8.36% year-on-year, closely aligned with the revenue decline. Despite a 60.18% increase in taxes and surcharges, the company effectively mitigated the amplification effect of revenue fluctuations on profits [10]. - The financial expenses for the third quarter were 2.298 billion yuan, a decrease of 18.03% year-on-year, and investment income reached 1.648 billion yuan, an increase of 19.95% year-on-year [10]. Future Outlook - The report indicates that the autumn flood has led to a significant improvement in water inflow, with the average outflow from the Three Gorges Reservoir increasing by 141.47% year-on-year as of October 30, and the water level reaching 174.21 meters, an increase of 6.3 meters year-on-year. This abundant water inflow in the fourth quarter is expected to further support annual performance growth [2][10]. - The company has announced a profit distribution plan for 2026-2030, committing to a cash dividend of no less than 70% of the net profit attributable to the parent company each year, reflecting a strong emphasis on shareholder returns [10].

Core Viewpoint - The company reported its Q3 2025 financial results, showing a slight increase in revenue but a decline in net profit compared to the previous year [1] Group 1: Financial Performance - For the first three quarters of 2025, the company achieved revenue of 1.14 billion yuan, a year-on-year increase of 4.95%, and a net profit attributable to shareholders of 4.22 billion yuan, a decrease of 4.54% [1] - In Q3 2025, the company reported revenue of 429 million yuan, a year-on-year decrease of 11.30%, and a net profit of 1.76 billion yuan, down 16.96% [1] Group 2: Power Generation and Pricing - The company’s hydropower and photovoltaic generation in Q3 2025 amounted to 2.579 billion kWh and 84 million kWh, representing year-on-year increases of 17.6% and a decrease of 24.3%, respectively [2] - The average on-grid electricity prices for hydropower and photovoltaic in Q3 2025 were 0.119 yuan/kWh and 0.439 yuan/kWh, reflecting year-on-year declines of 28.8% and 9.8% [2] - The total revenue from power generation in Q3 2025 was estimated at 344 million yuan, a decrease of 18.3% year-on-year [2] Group 3: Investment Performance - The company’s investment income in Q3 2025 was 1.762 billion yuan, a decrease of 15.8% year-on-year, primarily due to reduced water flow in the Yarlung Tsangpo River [3] - The company anticipates increased performance contributions from ongoing hydropower projects expected to commence operations in the near future [3] Group 4: Future Outlook - The company projects net profits attributable to shareholders of 4.767 billion yuan, 5.122 billion yuan, and 5.286 billion yuan for 2025, 2026, and 2027, respectively, with corresponding PE ratios of 15.06x, 14.02x, and 13.58x [3]

Investment Rating - The report maintains a "Buy" rating for the company, with a target price not specified [7][4]. Core Views - The company reported a revenue of 1.61 billion yuan in 2024, an increase of 8.5% year-on-year, and a net profit attributable to shareholders of 4.51 billion yuan, up 2.5% year-on-year [1][2]. - In Q1 2025, the company achieved a revenue of 360 million yuan, a significant increase of 41.2% year-on-year, and a net profit attributable to shareholders of 1.48 billion yuan, up 16.2% year-on-year [1][4]. - The decline in investment income in Q4 2024 negatively impacted the overall annual performance, particularly from the Yalong River Hydropower, which saw a net profit decrease of 4.5% year-on-year [2][4]. Financial Performance Summary - For 2024, the Yalong River Hydropower's net profit was 8.27 billion yuan, down 4.5% year-on-year, with a significant drop of approximately 77% in Q4 compared to the same period in 2023 [2]. - The company's Q4 2024 net profit was 86 million yuan, a decrease of 84.6% year-on-year, primarily due to a reduction in investment income from Yalong River Hydropower [2]. - The company expects net profits for 2025-2027 to be 5.08 billion, 5.28 billion, and 5.54 billion yuan respectively, with corresponding P/E ratios of 16.1, 15.5, and 14.8 [4][5]. Operational Highlights - The company’s controlling and equity investments contributed to a profit increase in Q1 2025, with a net profit of 1.48 billion yuan, reflecting a 16.2% year-on-year growth [3][4]. - The operational performance in Q1 2025 was bolstered by the commissioning of the first unit of the Yinjing Hydropower Station, which has a capacity of 390,000 kilowatts [11]. - The company anticipates improved performance from Yalong River Hydropower in Q1 2025, with expected revenue growth driven by increased electricity prices and generation capacity [11].