The world's largest wind power operator: China Longyuan Power Group Corporation, a new energy operation platform under the State Energy Group, is the first specialized company in China to develop wind power. By the end of 2021, the company's holding installed capacity reached 26.7 gigawatts, of which 23.7 gigawatts of wind power. Since 2015, it has maintained its position as the world's largest wind power operator. At present, the company has become a large comprehensive power generation group focusing on the development and operation of new energy, with more than 400 wind farms and photovoltaic, biomass, tidal, geothermal and thermal power generation projects, with business distribution throughout the country and countries such as Canada and South Africa.
High-speed and healthy growth of new energy business: the National Energy Group has planned to increase the installed scale of renewable energy to 70 to 80 gigawatts during the 14th five-year Plan period, and the company is the largest main body of new energy development and operation under the group. After the company completes the listing of A shares, it is expected to continue to expand its installed scale with the help of the continuous injection of the group's existing wind power assets. We estimate that the cumulative wind power holding capacity of the company from 2022 to 2024 will reach gigawatts in 25-27-29, and its revenue from power sales will reach RMB 338 billion (the same below), with an annual compound growth rate of 10.8%. In the era of landscape parity, the continuous technological innovation of the industrial chain brings cost reduction and efficiency dividend, the rate of return of the company's project is guaranteed, and the stock subsidy is expected to be substantially solved by policy support, and the cash flow situation will be improved.
Green power trading and power marketization bring about the reshaping of scenery value: the implementation of green power trading and liberalizing the electricity price policy of coal-fired power generation market is conducive to the corresponding improvement of the electricity price range of wind photovoltaic market transactions, as well as reflecting the green power premium, improve the marginal gain of the company's green power and thermal power price sales, domestic and foreign carbon market trading is also expected to open up new profit growth points in the future.
For the first time, the buy rating is given, with a target price of HK $19.6: the company is expected to take advantage of the group's advantages to continue to lead the industry in resource reserves and project acquisition capabilities; Aspirh's dual listing broadens and improves financing channels to support future project development capital requirements and maintain a healthy debt level. The company's long-term accumulation of wind power development, operation and management experience is expected to expand to offshore wind power and photovoltaic and other diversified project areas, to achieve a stable improvement of project returns and profitability. We forecast that the company's 2022-2024 net profit will be 93x113max, corresponding to EPS of 1.12max 1.35max, giving the company a target price of HK $19.6 for the next 12 months, corresponding to 15 times forecast price-to-earnings ratio and 1.8 times forecast price-to-book ratio in 2022, giving a buy rating for the first time.
Risk factors: new installed capacity is not as expected, electricity demand is lower than expected, and feed-in electricity price is greatly reduced.