维持“增持” 评级：考虑到海风核准进度等因素，下调2024~2025年EPS 至1.07/1.07 元（原值1.14/1.23 元），给予2026 年EPS 1.12元。参考火电行业可比公司，给予2024 年11 倍PE，上调目标价至11.77 元，维持“增持”评级。Introduction to this report:
The company's 2Q24 performance is in line with expectations, and there is still plenty of room for long-term installed growth.
Key points of investment:
Maintain the “gain” rating: Taking into account factors such as the progress of approval of Sea Breeze, the 2024-2025 EPS will be lowered to 1.07/1.07 yuan (original value 1.14/1.23 yuan), and the 2026 EPS will be given 1.12 yuan. Referring to comparable companies in the thermal power industry, PE was given 11 times in 2024, the target price was raised to 11.77 yuan, and the “gain” rating was maintained.
2Q24 results were in line with expectations. The company's 1H24 revenue was 6.66 billion yuan, +4.6% YoY; net profit to mother was 1.19 billion yuan, +27.1% YoY. The company's 2Q24 revenue was 3.58 billion yuan, +8.3% YoY; net profit to mother was 0.66 billion yuan, +64.5% YoY.
The recovery of wind power in Fujian led to an increase in wind power production, and gas and electricity losses in Jinjiang narrowed sharply over the same period last year. The company's 2Q24 performance growth mainly benefited from the increase in wind power generation and the improvement in gas and power profits in Jinjiang:
1) The company's 2Q24 wind power feed-in capacity was 1.12 billion kilowatt-hours, +19.7% year over year (we estimate mainly due to improved wind conditions in 2Q24 in Fujian Province, 641 hours of wind power utilization in Fujian Province, +26.7% year over year); 1H24 subsidiary Funeng Strait net profit of 0.23 billion yuan, +30.4% year on year; 2) The net profit of the company's subsidiary Jinjiang Gas Power 1H24 was -0.02 billion yuan, a year-on-year loss of 0.13 billion yuan. This is mainly due to the year-on-year increase in revenue from alternative electricity in the current period. The company's 2Q24 feed-in power was 5.54 billion kilowatt-hours, +3.3% year-on-year; of these, thermal power feed-in power was 4.41 billion kilowatt-hours, or -0.2% year-on-year, and thermal power feed-in power remained relatively stable.
The financial strength is strong, and there are plenty of superposition power supply projects, and the company still has a lot of room for long-term installed growth. The company announced in August 2024:1) The Changle Offshore Wind Farm Project in Haihai District J has been approved, with a proposed construction capacity of no more than 0.656 million kilowatts, with a total project investment of 6.59 billion yuan, with a project capital ratio of 30%; 2) The company plans to issue a total convertible bonds of no more than 3.9 billion yuan to build the Quanhui Petrochemical Industrial Zone cogeneration project (1.32 million kilowatts) and (1.4 million kilowatts of Fujian Xianyou Mulan pumped storage power plant project). Fujian Province plans to add 4.1 GW of grid-connected wind power to the “14th Five-Year Plan” and develop about 10.3 GW of offshore wind power in the provincial area. We believe that as an electric power listing platform in Fujian Province, the company has shareholder and location advantages, and is expected to continue to obtain resources for various power supply projects such as subsequent high-quality sea breezes. 1H24's net operating cash flow was 1.77 billion yuan, +21.4% YoY. We expect that with the support of abundant cash flow and abundant reserve resources, there is still room for long-term growth in multi-directional power companies such as Sea Breeze, Savings, and Traditional Power Sources.
Risk warning: coal prices exceed expectations, access to new energy resources falls short of expectations, etc.
