Event: the company issued a notice on adjusting the ladder electricity price of residential electricity consumption.

Today, the company issued a notice that it has received the notice of Suining Municipal Development and Reform Commission on adjusting the ladder electricity price of residential electricity consumption, adjusting the ladder electricity price of residential electricity consumption. The electricity price adjustment time will be implemented from November 1, 12, which is in line with our previous expectations.

Our comments and analysis

The price adjustment is in line with expectations and is expected to improve earnings in the fourth quarter.

The profit forecast for the whole year remains unchanged, maintaining the previous investment logic

As this electricity price increase is in line with our expectations, we maintain the company's full-year profit forecast unchanged, without taking into account the investment income from the future sale of shares in Huaxi Securities, we forecast that the company's EPS from 2012 to 2014 will be 0.473 yuan, 0.602 yuan and 0.721 yuan respectively, with the current share price corresponding to 20 × 12PE and 15 × 13PE.

The current stock price of the company corresponds to 20 × 12PE and 15 × 13PE, which is obviously lower than the average level of the small hydropower company at present. we think that the company has a certain margin of safety at present, giving the company 25 × 12PE and 20 × 13PE with a target price of 11.83-12.04. considering the asset price of 3.16 yuan per share of vanadium assets, the target price of the company is 14.99-15.20 yuan.