Event: when the company released its quarterly report for 2023, 23Q3 achieved revenue of 27.8 billion yuan, an increase of 11.3% over the same period last year, and a net profit of 3.18 billion yuan, an increase of 5460% over the same period last year and 80% month-on-month growth. In the first three quarters, the company realized revenue / return net profit / net investment income respectively, up 14.2%, 1217% and 35.7% respectively over the same period last year.

Benefiting from the increase in demand in the province, the growth of electricity generation is steady. Benefiting from the increase in electricity consumption of the whole society in Zhejiang Province, the company completed 120.7 billion kilowatt-hours of electricity generation in the first three quarters, an increase of 4.3 percent over the same period last year, and 114.3 billion kilowatt-hours of electricity on the Internet, an increase of 4.4 percent over the same period last year. From a power point of view, thermal power generation completed 120.6 billion kilowatt-hours, an increase of 4.22 percent over the same period last year, a steady growth rate; photovoltaic power generation completed 175 million kilowatt-hours, an increase of 50.9 percent over the same period last year, of which Zhonglai shares contributed 35 million kilowatt-hours (20.6 percent).

Profitability continues to improve. The average online settlement price of the company in the first three quarters was 0.438 yuan per kilowatt-hour, up 0.46% from the same period last year. Thanks to the decline in coal prices, the company's gross profit margin reached 10.32% in the first three quarters, up 16.18% from the same period last year, and increased 16.17pp over the same period last year.

Zhonglai shares have high performance growth and industrial synergy. 23Q3 Zhonglai shares achieved revenue of 3.98 billion yuan, an increase of 33.3% over the same period last year, and a net profit of 247 million yuan, an increase of 135 million yuan over the same period last year, with a gross profit margin of 19.5%, an increase of 3.6pp over the same period last year. Zhonglai shares are controlled by the company and cut into the new energy racetrack, which is expected to continue to exert industrial synergy in the future.

Profit forecast and investment advice. It is estimated that the 23-25 net profit of the company will be 6.48 billion yuan / 7.63 billion yuan / 8.75 billion yuan respectively, corresponding to an EPS of 0.48, 0.57 and 0.65 yuan respectively, maintaining a "buy" rating.

Risk hint: the risk of fluctuation of coal price and electricity price and the risk that the development of new energy is less than expected.