Incident: The company released its 2023 annual report and its quarterly report for 2014. Compared with the same period of the previous year (after adjustment), the company achieved a year-on-year increase of 5.15%, and realized net profit of 10.624 billion yuan. Compared with the same period of the previous year (after adjustment), the year-on-year increase was 17.91%; net profit after deducting non-return to mother was 10.396 billion yuan, an increase of 15.06% compared with the same period last year (after adjustment). In the first quarter of 2024, the company achieved operating income of 17.988 billion yuan, an increase of 0.53% compared with the same period of the previous year (after adjustment), and achieved net profit of 3,059 billion yuan. Compared with the same period of the previous year (after adjustment), the company achieved a year-on-year increase of 1.18%. The performance grew steadily, in line with expectations.
Nuclear power and new energy generation are stable, and new energy sources account for more than 10% of the power generation. According to the company's announcement, the company's power generation capacity in '23 was 209.858 billion kilowatt-hours, up 5.3% over the same period last year; among them, the company's nuclear power generation capacity was 186.477 billion kilowatt-hours, up 0.67% over the same period last year, and the cumulative feed-in capacity was 174.458 billion kilowatt-hours, up 0.72% year on year; new energy generation capacity was 23.382 billion kilowatt-hours, up 66.44% year on year, including: photovoltaic power generation capacity was 12.478 billion kilowatt-hours, up 66.14% year on year, wind power generation 10.903 billion kilowatt-hours, an increase of 66.78% over the previous year, mainly due to the increase in installed capacity of new energy sources compared to the same period last year, leading to an increase in power generation. The company's installed capacity in operation increased by nearly 6 million kilowatts in 2023, accounting for more than 10% of the power generation; the year-on-year increase in the company's new energy installed capacity and feed-in electricity supported the steady growth of the company's revenue and performance.
There are enough nuclear power and new energy projects under construction, and nuclear power projects entered the peak production period in '26 and '27. According to the company's announcement, as of March 31, 20234, the Company's Nuclear Power Holdings had a total of 25 units in operation, with an installed capacity of 23.75 million kilowatts, 15 units under construction and approved to be started, with an installed capacity of 17.565 million kilowatts, and a total installed capacity of 41.315 million kilowatts of nuclear power; New Energy Holdings had an installed capacity of 21.346 million kilowatts (including wind power, 140.08 million kilowatts of photovoltaics), with an installed capacity of 14.262,600 kilowatts (including wind power) 3.3398 million kilowatts, 10.928 million kilowatts of photovoltaics), and also owns 679,000 kilowatts of independent energy storage power plants. The company has sufficient nuclear power and new energy projects under construction and approval. In the year 24 and 25, units 1 and 2 in Zhangzhou are planned to be put into commercial operation, and 2 and 5 units are planned to be put into commercial operation in 26 and 27, respectively. We believe that as projects under construction and approved projects continue to be put into operation, the company's power generation capacity will continue to increase, providing sufficient impetus for the company's performance growth.
Revitalize the existing assets of the new energy industry and meet the financial needs of Sino-Singapore energy development. On April 26, the company issued an announcement on the equity and consolidated REITs issuance plan of the holding subsidiary CNNC Huineng Co., Ltd., with an issuance scale of not more than RMB 7.5 billion. CNNC and related parties purchased a total limited partnership share of 15% to 20%, and acted as an operation guarantee agency for follow-up projects. Among them, the underlying assets were photovoltaics and wind power new energy projects owned by CNNC Huineng itself or owned by subsidiary companies. It was initially determined that they were wind power and photovoltaic assets held by 24 project companies. We believe this measure is expected to revitalize the company's existing assets in the new energy industry and reduce the company's balance ratio.
Investment suggestions and valuation: The company vigorously develops nuclear energy and non-nuclear clean energy, and its performance has grown steadily. It gradually entered the peak production period for nuclear power projects in '26 and '27. We expect the company's revenue from 2024 to 2026 to be 79.859 billion yuan, 89.184 billion yuan and 96.454 billion yuan respectively, with growth rates of 6.5%, 11.7%, and 8.2% respectively, and net profit of 11.018 billion yuan, 12.793 billion yuan and 13.282 billion yuan respectively, with growth rates of 3.7%, 16.1% and 3.8% respectively, maintaining the “buy” investment rating.
Risk warning: Project progress falls short of expectations; approval progress falls short of expectations; risk of electricity prices falling short of expectations; policy progress falls short of expectations.