Recently, the company released three quarterly reports for 23 years, with revenue of 28.097 billion yuan in the first three quarters,-7% year-on-year, and net profit of 6.379 billion yuan, + 19% year-on-year. Of which Q3 revenue was 8.25 billion yuan,-3.4% compared with the same period last year, and the net profit was 1.255 billion yuan, + 21.8% compared with the same period last year.
Business performance remains stable. In 23 years, Q1, Q2 and Q3 achieved main income of 98.6,99.9 and 8.25 billion yuan respectively (Q3 is the same as Q3, month-on-month ratio is-3.4% qamei 17.4%), and net profit is 24.18,27.06 and 1.254 billion yuan respectively (Q3 same and Q3 + 21.8% Cue 53.7%). The slight decline in Q3 main revenue from the same period last year is mainly due to a decrease of about 381 million yuan in revenue from the thermal power division compared with the same period last year. The year-on-year increase in Q3 net profit mainly benefits from: (1) the increase in power generation brought about by the increase in photovoltaic installed capacity; (2) the decline in coal prices and the decline in thermal power operating costs. The Q3 month-on-month decline is due to the traditional off-season of wind power in the third quarter.
Electricity production increased by 7.8% compared with the same period last year. From January to September 2023, benefiting from the steady increase in the scale of the company's installed capacity, the company completed a total of 55504.55 gigawatt hours of electricity generation, an increase of 7.8% over the same period last year. Among them, wind power accounted for 80.5%, an increase of 6.2% over the same period last year (wind power installation increased by 4.1% year-on-year); other renewable energy generation increased by 136.4% year-on-year (installed capacity increased by 226.3%).
The new installed scale is expected to increase rapidly. In the first three quarters, the company added 1.7 GW of installed capacity, including 0.58 GW for wind power and 1.12 GW for photovoltaic. By the end of the third quarter of 23, the company's holding installed capacity was 32.81 GW, including wind power holding capacity 26.77 GW, photovoltaic and other renewable energy 4.16 GW, thermal power 1.875 GW, and wind power accounted for about 81.6% of the total installed capacity. We expect that the new installed capacity of the company during the 14th five-year Plan period will be about 25-30 GW,23-25 years, the new installed scale of the company may reach 5.5 GW 8 GW respectively, and the installed scale of new energy is expected to usher in a period of rapid growth.
A large proportion of buybacks may be beneficial to the company's valuation. According to the company's announcement on September 27, the general meeting of shareholders of the company has passed a motion to buy back no more than 10% of the H shares in Hong Kong, and the price per share is not higher than 5% of the average closing price of the five trading days before the repurchase, and the repurchased shares will be cancelled after the repurchase is completed. We expect that if the buyback is formally implemented, it may become a trigger to raise the company's share price valuation.
Earnings forecast and valuation: we expect the company's 25th year revenue to be 400.9max 457.4 / 52.18 billion respectively, and the net profit attributable to equity holders of the Company to be 85.1 billion 102.1 plus 1.43 yuan per share, respectively, and the current price-to-earnings ratio is 6.25x5.21x4.45X respectively. As the leading company of wind power operation, the installation of new energy is expected to reach a peak in the next three years, major shareholders will continue to inject high-quality new energy assets, coupled with the company may start a large proportion of buybacks in the near future, the valuation level is expected to be improved. Give a "buy" investment rating and a target price of HK $11, corresponding to PE 10.0X in 2023. (HK $1 = RMB 0.9355)
Risk hint: the wind is not as good as expected; the new installed scale is not as expected.