The Zhitong Finance App learned that DAMO released a research report saying that maintaining the “increase in holdings” rating of HKDC-SS (02638), the target price was lowered from HK$8.6 to HK$6.4. It is expected that the US interest rate hike cycle is nearing the end. Investors' interest in local utility stocks will pick up, and they are optimistic about the defensive nature of CLP Holdings (00002) and Hong Kong Lighting.

The bank stated,In the first half of the year, net profit attributable to owners of contracted shares of the company increased 9.8% year on year, electricity sales volume increased 3.3% year on year. The mid-term distribution for each share remained 15.94 cents. The bank expects the distribution to remain the same for the whole year.Hong Kong Light's financial costs increased 62% to HK$645 million from $399 million in mid-2022. Considering the HIBOR trend and its net debt of 51 billion yuan, interest costs should have risen sharply, but through a hedging strategy of locking in 72% to 74% fixed interest rates, the company was still able to control cost increases during the period.

In addition, the company has submitted a 2024-28 development plan to the Hong Kong Government. The bank estimates that capital expenditure under the profit management agreement (SOC) for the next five years will reach 25.5 billion yuan, the same as the original plan of 26.6 billion yuan. Among them, it is expected that in the future, Hong Kong Electric will build another gas unit, replace an open gas turbine, build a new 150MW offshore wind power project, and complete the Hong Kong smart meter installation project (current progress of more than 50%). It is also estimated that the capital expenditure plan will increase its fixed assets from 420228 2.9%