Incidents: 1) The company released its 2022 quarterly report on April 27, '22. 22Q1 achieved operating income of 4.290 billion yuan, an increase of 22.24% over the previous year; net profit of 415 million yuan, a decrease of 2.5% over the previous year; net profit of 413 million yuan after deducting non-return mother, a decrease of 2.6% over the previous year; and EPS of 0.15 yuan. 2) The company plans to invest 100 million yuan as a limited partner to participate in the expansion of the China Power Investment Science and Technology Innovation Fund. The fund invests in emerging energy projects such as hydrogen energy and energy storage.
Comment: The transaction price of thermal power increased by more than 20% over the same period last year, and the company's profitability increased steadily. The company's first-quarter performance slightly exceeded expectations. The revenue side mainly benefited from the company's thermal power grid transaction price increase of more than 20% and the increase in installed capacity. The company's 22Q1 revenue was 4.290 billion yuan, an increase of 22.24% over the previous year.
On the cost side, the coal price in Qinhuangdao Changxie 22Q1 was 723 yuan/ton. Although it fell by 2.82% from 21Q4, it was still 22.53% higher than 21Q1. Taken together, the gross profit margin of the company's power business was 24.64%, a year-on-year decrease of 3.27 pcts; operating profit was 573 million yuan, an increase of 0.83% over the previous year. The company's net profit after deducting non-return income was 412 million yuan, down 2.6% year on year, mainly due to income tax rising 10.13% year on year and minority shareholders' profit and loss increasing 11.01% year on year. Mainly, the installed capacity of new energy increased by more than 46% year on year, and the company's net operating cash flow was 997 million yuan, an increase of 11.93% over the previous year.
New energy accounts for more than 70% of the installed capacity, and capital expenditure is rising rapidly. The company added 1,612,800 kilowatts connected to the grid in the first quarter, mainly projects connected to the grid after commissioning in 2021. Among them, wind power and photovoltaics added 1,329,900 kilowatts and 288,900 kilowatts respectively. The cumulative installed capacity accounted for 26.0% and 46.63% respectively, and the cumulative total installed capacity reached 1,558,500 kilowatts, accounting for 72.6%, an increase of 4.23 pcts over the end of 2021. The company's capital expenditure in the first quarter was 1,969 billion yuan, a sharp increase of 61.30% over the previous year, mainly due to increased investment in new energy projects. It is expected that new energy installations will maintain a high growth rate throughout the year.
Relying on the National Power Investment Fund, the deployment of hydrogen storage will be increased and deepened. The company continues to deepen its hydrogen energy and energy storage layout, and plans to invest 100 million yuan to participate in the expansion of the China Power Investment Corporation Science and Technology Innovation Fund. The fund's investment direction is mainly hydrogen energy, energy storage and other emerging energy projects. The company's pledges accounted for 11.1% of the total number of new pledges, and after payment, accounted for 3.57% of the fund share, second only to China Power Investment Corporation and CLP New Energy. Furthermore, the hydrogen energy demonstration project under construction is planned for trial production within the year, and the company's “second transformation” is progressing steadily.
Profit forecast: The company's revenue for 2022-2024 is estimated to be 162.59/189.32/219.72 billion yuan, net profit of 1,345/17.89/2,244 billion yuan, EPS of 0.48/0.64/0.81, corresponding to PE13.09/9.84/7.78 times, maintaining the “buy” rating.
Risk warning: The increase in coal prices has exceeded expectations, and the development of new energy projects has fallen short of expectations