Citigroup released a report and initiated a 90-day upward catalyst observation on China Power (02380.HK), rating it as "buy" with a target price of 4.3 yuan.

The bank pointed out that it held an investor meeting with China Power and expected the company to benefit from the reform of China's electric utilities industry. These reforms may be announced at the Third Plenum from July 15th to 18th, supporting more consumption of renewable energy and encouraging more related equipment. At the same time, the company's net profit in the first half of the year is expected to increase significantly by 62% to 2.714 billion yuan, driven by strong performance in the hydroelectric power business.

Citigroup predicts that China Power will accelerate the expansion of clean energy and achieve 90% clean energy capacity combination by 2025, while it is only 75% in 2023. It believes that this can be achieved through potential injection of assets from its parent company. As for the company's capital expenditures for new projects this year, it may be reduced to less than 30 billion yuan, and new projects are expected to achieve a 10% ROI.