Main points of investment:
Event: the company announces results for the third quarter of 2023. In the first three quarters, the net profit attributed to the ordinary shareholders of the parent company was 6.379 billion yuan (the same below), an increase of 18.95% over the same period last year, slightly higher than the 6.13 billion yuan we expected in the forecast of the third quarterly report. Among them, the net profit attributed to the ordinary shareholders of the parent company in the third quarter was 1.254 billion yuan, an increase of 21.82% over the same period last year.
Wind power generation declined slightly in the third quarter, and the inverted electricity price was stable compared with the same period last year. According to the company's operating data announcement, the company achieved wind power generation of 44.67 billion kilowatt hours in the first three quarters, an increase of 6.17 percent over the same period last year, and calculated that wind power generation in a single quarter in the third quarter was 11.565 billion kilowatt hours, a decrease of 2.5 percent over the same period last year. The company achieved wind power revenue of 20.857 billion yuan in the first three quarters, an increase of 3.5% over the same period last year, of which wind power revenue reached 5.643 billion yuan in the third quarter, down 3.6% from the same period last year. The decrease in the company's overall operating revenue is mainly due to the impact of thermal power, which decreased by 34.2% in the first three quarters compared with the same period last year.
The financial expenses in the first three quarters decreased by 423 million yuan compared with the same period last year, and those in the third quarter decreased by 210 million yuan compared with the same period last year. The financial expenses of the company in the first three quarters of 2023 were 2.511 billion yuan, compared with 2.934 billion yuan in the same period last year, a decrease of 423 million yuan compared with the same period last year. The financial expenses for the third quarter of 2023 were 948 million yuan, compared with 1.158 billion yuan in the same period last year, a decrease of 210 million yuan over the same period last year. From the debt side, at the end of September 2023 compared with the end of September 2022, short-term loans increased by 7.8 billion yuan, long-term loans increased by 20.37 billion yuan, bonds payable decreased by about 5.8 billion yuan, and total liabilities increased by 12.8 billion yuan. At the same time, the company's perpetual debt at the end of September 2023 was 2.005 billion yuan, compared with 6.002 billion yuan in the same period last year (interest on perpetual debt was not included in financial expenses). While the company's interest-bearing liabilities increased significantly, financial expenses decreased against the trend, reflecting a significant drop in loan interest rates. the ultra-short financing rate issued by the company in September was 2.31%.
The investment income from the joint venture and joint venture company becomes positive, and the company's joint venture thermal power company and Guodian United Power Technology Company are expected to reverse losses.
In recent years, the company's investment income from joint ventures and joint ventures has been negative for a long time, mainly due to the sustained losses of Jiangsu Nantong Power Generation and Guodian United Power Technology Co., Ltd., with a loss of 350 million yuan and 1.57 billion yuan respectively in 2022. The company's investment income from joint ventures and joint ventures in the first three quarters of 2023 was 8 million yuan, of which 69 million yuan in the third quarter was the highest since 2020. The two major loss-making equity companies are expected to reverse their losses.
The announcement intends to buy back no more than 10% of the shares in Hong Kong, demonstrating the major shareholders' recognition of the value of the company. The company announced in September that it intends to buy back no more than 10% of its shares in Hong Kong stocks. against the background of the global carbon neutralization trend, we analyze that this buyback demonstrates the major shareholders' recognition of the value of the company on the one hand, and on the other hand, we analyze that the company's recent stock price correction is related to the lack of liquidity in the Hong Kong stock market. Major shareholder buybacks will inject liquidity into the company's Hong Kong shares.
Earnings forecast and rating: combined with the results of the three quarters of 2023, we maintain the company's home net profit forecast of 78.9,90.02 and 10.116 billion yuan respectively from 2023 to 2025, with the current share price corresponding to 8 times, 7 times and 6 times of PE. We believe that the company's current share price has a high margin of safety and maintains a "buy" rating.
Risk hint: the wind condition is not as good as expected, and the rate of return of the new project is not as expected.