2022/1Q23 's net profit from home was + 126% RMB 39% year on year, and its profit forecast and target price were raised. Jingneng Electric Power announced its results: in 2022, it achieved revenue of 30.5 billion yuan (adjusted year-on-year + 37%), home net profit of 800 million yuan (adjusted year-on-year + 126%), in line with the performance forecast range (63m-900 million yuan); 1Q23 achieved revenue of 8.6 billion yuan (year-on-year + 9%) and home net profit of 410 million yuan (year-on-year + 39%), and profitability continued to repair. According to the profit forecast adjusted according to the project under construction and the change of hours, it is estimated that the return net profit in 23-25 years is 13.6 trillion yuan (the previous value is 1.25 billion) and BPS3.73/3.80/3.83. With reference to the comparable 23-year PB average of 1.1x (Wind consensus expectation), the company is given a 23-year 1.1x target PB with a target price of 4.10 yuan (the previous value of 3.67 yuan is based on 1.1x 22e PB) to maintain the "overweight" rating.
The rising momentum of coal and electricity prices continues, and projects under construction are put into production one after another.
In the year of 2022/1Q23, the company's power generation increased from + 10% to 794 billion kilowatt-hours, and the demand in the power delivery area of the company's generator sets continued to pick up. The average electricity price of 2022/1Q23 Company is 0.8% to 383% 417 yuan per megawatt hour compared with the same period last year, and the proportion of electricity in the company's market will reach 99.88% in 2022. The company has realized the overall transaction electricity price to continue to rise by optimizing electricity allocation and replacing / coordinating regional intra-regional transaction electricity price. In 2022, the company put into production of Jingning Phase II # 3 unit (660,000 kilowatts), which is expected to contribute to the increment in 2023. At the end of 2022, there are four coal power projects under construction / the installed capacity is 365 million kilowatts, accounting for 20% of the company's operating capacity, and is expected to be put into production from 2023. In April 2023, the company announced that it planned to invest in the 2 million kilowatt expansion project of Zhuozhou thermal power plant, which is scheduled to be put into production in 2026.
The development of new energy has been intensified, and the green power transaction has made a breakthrough.
Based on the location advantage, the company actively strives for the new energy development index of the power transmission channel, as well as the flexible transformation capacity new energy allocation index. Construction of the scenery project began in 2022, including 250000 kilowatts of full capacity connected to the grid and 200,000 kilowatts of projects under construction at the end of the year. In 2022, the company set up four new energy branches to carry out intensive management of projects in the region, and the new energy target for the whole year landed on the ground of 2.4 million kilowatts. In 2022, the company completed the agency transaction with a total of 16.9 billion kilowatt-hours, increased the green power trading business, and completed 1.5 billion kilowatt-hours of electricity for the whole year.
The performance is flexible enough to maintain the increased rating.
The fundamentals of the thermal power industry bottomed out and rebounded, the company's 2022/1Q23 performance continued to improve significantly, and the performance was flexible enough from 2023 to 2025. Comparable company's 23-year PB average 1.1x (Wind consensus expectations), the company's current share price corresponds to 23-year 0.88xPB. The company's thermal power assets are of high quality, giving the company 22 years of 1.1xPB, with a target price of 4.10 yuan per share. Maintain the overweight rating.
Risk tips: the increase in coal prices is higher than expected, the number of hours of utilization is declining, and the progress of projects under construction is not as expected.