Core views

In the first three quarters of 2024, the company achieved operating income of 35.971 billion yuan, an increase of 9.61% year on year; net profit to mother was 1.587 billion yuan, an increase of 3.88% year on year, mainly due to the year-on-year increase in gas group profit. Looking at 2024Q3 alone, the company achieved revenue of 13.123 billion yuan, a year-on-year increase of 18.36%; net profit to mother was 0.44 billion yuan, an increase of 6.98% year-on-year, mainly due to an increase in gas business profit. In the first three quarters of 2024, the company achieved a cumulative total of 18.6 billion kilowatt-hours of power generation, an increase of 9.26% over the previous year; thermal power, wind power, and photovoltaics generated 13.536 billion kilowatt-hours, 3.718 billion kilowatt-hours, and 1.346 billion kilowatt-hours respectively, with year-on-year changes of -0.7%, +57.86%, and +29.9% year-on-year. In terms of gas, the company sold 2.984 billion cubic meters of pipeline gas in the first three quarters, +40.26% over the same period last year. The company combines multiple businesses to create multiple growth poles, and the coal power and gas power industry chains are expected to contribute to profit growth in the future.

The company insists on giving back cash dividends to shareholders, and dividend returns are attractive.

occurrences

The company released its report for the third quarter of 2024

In the first three quarters of 2024, the company achieved operating income of 35.971 billion yuan, up 9.61% year on year; net profit of 1.587 billion yuan, up 3.88% year on year; net profit after deducting 1.554 billion yuan, up 5.08% year on year; achieved a weighted return on net assets of 6.09%, a decrease of 0.07 percentage points year on year; and achieved basic earnings per share of 0.454 yuan/share, up 3.8% year on year. Looking at 2024Q3 alone, the company achieved revenue of 13.123 billion yuan, an increase of 18.36% year on year, and realized net profit of 0.44 billion yuan to mother, an increase of 6.98% year on year.

Brief review

Revenue performance increased slightly, and gas business profits grew faster

In the first three quarters of 2024, the company achieved operating income of 35.971 billion yuan, an increase of 9.61% year on year; net profit to mother was 1.587 billion yuan, an increase of 3.88% year on year, mainly due to the year-on-year increase in gas group profit. Looking at 2024Q3 alone, the company achieved revenue of 13.123 billion yuan, a year-on-year increase of 18.36%; net profit to mother was 0.44 billion yuan, an increase of 6.98% year-on-year, mainly due to an increase in gas business profit. In the first three quarters of 2024, the company achieved a cumulative power generation capacity of 18.6 billion kilowatt-hours, an increase of 9.26% over the previous year; completed feed-in electricity generation of 17.787 billion kilowatt-hours, an increase of 10.24% over the previous year. Specifically, thermal power, wind power, and photovoltaics generated 13.536 billion kilowatt-hours, 3.718 billion kilowatt-hours, and 1.346 billion kilowatt-hours respectively, with year-on-year changes of -0.7%, +57.86%, and +29.9%. In the third quarter of 2024, the company completed 6.52 billion kilowatt-hours of power generation, up 3.73% year on year; completed feed-in electricity generation of 6.243 billion kilowatt-hours, an increase of 4.78% year on year. Specifically, thermal power, wind power, and photovoltaics generated 4.807 billion kilowatt-hours, 1.101 billion kilowatt-hours, and 0.618 billion kilowatt-hours respectively, with year-on-year changes of -8.79%, +86.05%, and 44.03%. In terms of gas, the company sold 2.984 billion cubic meters of pipeline gas in the first three quarters, +40.26% year on year, and 1.429 billion cubic meters of natural gas delivery, -5.74% year on year.

Multiple growth poles contribute to profit growth and maintain a “buy” rating

The company combines multiple businesses to create multiple growth poles, and the coal power and gas power industry chains are expected to contribute to profit growth in the future. The company clearly announced that the dividend ratio should not be less than 40%, and the dividend return is attractive. We expect the company's net profit from 2024 to 2026 to be 1.834 billion yuan, 2.116 billion yuan, and 2.373 billion yuan respectively, corresponding to EPS of 0.52 yuan/share, 0.6 yuan/share, and 0.68 yuan/share, maintaining a “buy” rating.

Risk analysis

Coal-fuel cost risk: If the domestic coal market price rebounds sharply to a high level, causing the company's coal price to exceed the thermal power break-even line, there is still a possibility that the company's future thermal power business will continue to lose money.

Electricity price policy risk: The company is in the electricity industry, and changes in feed-in tariffs are affected by policy adjustments. If there is a major change in the electricity price policy or electricity market transaction mechanism, the company's average feed-in tariff falls, and the company's performance will decline.

Risk of new energy installations falling short of expectations: The company's new energy installation schedule is affected by factors such as project reserves, policy environment, and raw material prices. If the company's project reserves are insufficient or the installed environment changes, there is a risk that the installation progress will fall short of expectations.