Investment Rating - The investment rating for the company is "Buy" [11] Core Views - The company, as a flagship hydropower platform in Sichuan, benefits significantly from its 48% stake in Yalong River Company and 20% stake in Dadu River Company, which are expected to contribute 88% and 9% respectively to the net profit in 2024 [2][5] - The growth of the company is closely tied to the operational schedule of Yalong River Company, with significant performance improvements expected from the recent capital expansions and new project launches [2][9] - The potential for dividend distribution is anticipated to increase as capital expenditure pressures ease and profitability improves [8][9] Summary by Sections Company Overview - The company has a unique resource advantage in the Yalong River, Dadu River, and Tianwan River basins, focusing on hydropower resource development and operation [5][25] - The company's performance is primarily driven by investment income, with Yalong River and Dadu River contributing significantly to net profits [5][31] Yalong River Company - Yalong River Company holds exclusive development rights in the Yalong River basin, with substantial growth potential due to ongoing and planned projects totaling 7.82 million kilowatts [6][40] - The company is expected to see a 273% increase in installed capacity by 2035, significantly enhancing its growth prospects [6][45] Dadu River Company - Dadu River Company is entering a new production cycle, with several projects expected to come online by 2026, contributing to a projected net profit increase of 38.79% in 2024 [7][9] Dividend Potential - The "investment distribution difference" between Yalong River and Dadu River is crucial for the company's profit allocation, with expectations for steady improvement in this area [8][9] Market Position - The company is positioned to benefit from high electricity prices due to its significant inter-provincial power sales, which enhance overall revenue [54][55] - The company has a strong operational history, with past performance driven by the successful commissioning of hydropower stations [20][22]

Core Viewpoint - The company, Tongyu Heavy Industry, is positioned to capitalize on the national initiative to develop hydropower resources by producing key components for hydropower units [1] Group 1 - The company can manufacture critical core components such as turbine main shafts, generator main shafts, and yoke rings for hydropower units [1] - The company aims to continuously develop new supporting products for hydropower units [1]

Investment Rating - The investment rating for the company is "Outperform the Market" (maintained) [2][7] Core Views - The establishment of China Yarlung Group Co., Ltd. is expected to promote the development of hydropower resources in the Yarlung Zangbo River, leading to an acceleration in domestic hydropower equipment orders, which will benefit Dongfang Electric as a leading hydropower equipment manufacturer in China [3][6] - The total investment for the Yarlung Zangbo River downstream hydropower project is approximately 1.2 trillion yuan, with the construction of five cascade power stations [3][4] Financial Forecasts - The profit forecasts for Dongfang Electric for 2025-2027 are 4.34 billion yuan, 5.52 billion yuan, and 6.09 billion yuan, representing year-on-year growth of 48.5%, 27.2%, and 10.3% respectively [3][6] - The current price-to-earnings (PE) ratios for the years 2025, 2026, and 2027 are projected to be 13.9, 11.0, and 9.9 times respectively [3][6] Market Data - The company has a market share of 41.6% in pumped storage and 45% in conventional hydropower, indicating a strong competitive position in the energy equipment sector [5] - The company has achieved significant technological advancements, including the development of the world's largest 500 MW hydraulic turbine model and the first domestically produced 300 MW variable-speed pumped storage unit [5]