1H23 homing net profit yoy-28%, reduces profit forecast and target price
According to the semi-annual report released by Jingneng Electric Power, 1H23 realized revenue of 15.007 billion yuan (yoy+7%), net profit of 368 million yuan (yoy-28%) and non-net profit of 353 million yuan (yoy-29%). Among them, 2Q23 realized revenue of 6.43 billion yuan (yoy+3%,qoq-25%) and net profit of-39.19 million yuan (yoy-118%,qoq-110%). According to the progress of the project under construction, the number of hours of utilization and the change of coal price, the profit forecast is lowered, and the estimated net return profit for 23-25 is 1.58 billion yuan (1.48 billion yuan) for 23-25, and 3.74 million yuan (3.83 yuan) for BPS 3.69). With reference to the comparable 23-year average PB of 1.1x (Wind consensus expectation), the company is given a 23-year 1.1x target PB with a target price of 4.06 yuan (the previous value of 4.10 yuan is based on 23-year 1.1xPB) to maintain the "overweight" rating.
Coal electricity continues to grow, and electricity price fluctuations are affected by the spot market.
1H23's power generation capacity is + 10% to 39.9 billion kilowatt hours compared with the same period last year, and the demand in the power transmission area of the company's generator sets continues to pick up, of which thermal power generation is from + 9% to 39.7 billion kilowatt hours. The on-grid electricity price of 1H23 Company fluctuates with the market, and the spot market of electricity in the main distribution area of generator sets is rolled out in an all-round way. Jingning Phase II # 3Compact 4 units (each 660,000 kilowatts) will be put into production at the end of 22 / April 23 and contribute to power generation increment in 2023; Jingtai Phase II (2x66 million kilowatts) is scheduled to be put into operation in August 23. In April 2023, the company announced that it intends to invest in the 2 million kilowatt expansion project of Zhuozhou thermal power plant, which is scheduled to be put into production in 2026, and land expropriation has been carried out so far; in July, the company announced that the second phase of Qinhuangdao thermal power plant 2x66 has been approved.
The new energy target is gradually falling to the ground, which is expected to contribute to the increment of power generation.
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. In 2023, new energy projects are planned to put into production of 200000 kilowatts, all of which are photovoltaic projects, and 1.8 million kilowatt wind power projects have started construction one after another. 1H23's new energy generates 200 million kilowatt-hours of electricity, and with the projects under construction going into production, the scale of new energy is expected to continue to grow substantially.
The performance is flexible enough to maintain the increased rating.
The fundamentals of the thermal power industry bottomed out and rebounded, and the company suffered a temporary loss in 2Q23, but the performance flexibility in 2023-2025 is still sufficient. Comparable company's 23-year PB average 1.1x (Wind consensus expectations), the company's current share price corresponds to 23-year 0.92xPB. The company's thermal power assets are of high quality, giving the company 23 years of 1.1xPB, with a target price of 4.06yuan 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.