Key points of investment
2024Q1's profit was RMB 832 million, down 0.89% year over year:
The company achieved revenue of 7.907 billion yuan in 2024Q1, up 20.55% year on year; net profit attributable to shareholders of 832 million yuan, down 0.89% year on year; basic earnings per share of 0.2 yuan, the same year on year; and weighted average return on net assets of 3.82%, down 0.2 percentage points year on year.
Total sales volume of 2024Q1 natural gas increased by 33.86%, and subsequent profit is expected to continue to improve:
In the first quarter, the company's total gas transportation volume was 2.23 billion cubic meters, up 33.86% year on year; gas sales volume was 1,987 million cubic meters, up 39.93% year on year, including retail gas volume 638 million cubic meters, up 20.12% year on year; wholesale gas volume was 966 million square meters, up 10.58% year on year; LNG sales volume was 363 million litres, up +46589.68% year on year, mainly benefiting from the explosive growth of Tangshan LNG production. It is expected that in 2024, benefiting from the decline in upstream annual contract costs and the low cost advantage brought by the company's LNG spot imports, the company's natural gas business profits will continue to improve. Looking ahead to 2025, with the investment in the Tangshan LNG Phase II project, the value of the company's natural gas industry chain is expected to be rapidly released, and the natural gas business is expected to become the core stable source supporting the company's performance growth.
2024Q1 Poor wind resources affect the growth of power generation and new energy profits:
In the first quarter, the company controlled 4.117 billion kilowatts of electricity, up 0.27% year on year, of which 4.078 billion kilowatts of wind power generation, up 0.36% year on year; in the first quarter, the company completed market-based electricity transactions of about 1,435 billion kilowatts, accounting for 35.67% (32.08% in the same period last year), an increase of 3.59 percentage points over the previous year.
In 1Q24, the company's average feed-in tariff (excluding tax) was 0.43 yuan/kwh, down 0.01 yuan/kwh from the previous year. Affected by wind resources and power restrictions in Hebei, the number of hours used by the company's wind power has declined, compounded by the downward trend in feed-in tariffs for new energy sources, and the overall performance growth of new energy sources is not optimistic.
Maintaining a buy rating, target price of HK$4.52:
Based on industry valuations, we gave the company a target price of HK$4.52, which is equivalent to 6.5 times and 5.5 times PE in 2024 and 2025. The target price has room to increase 23% from the current price, maintaining the purchase rating.