Many departments are pushing for market-oriented electricity transactions, with large orders exceeding 200 million yuan and 8 power stocks being raised.
Recently, the National Energy Administration announced the national power industry statistics from January to June 2018. From January to June, the total electricity consumption of the whole society reached 3,229.1 billion kilowatt hours, a year-on-year increase of 9.4%; the installed power generation capacity of power plants of 6,000 kilowatts and above was 1,730.58 million kilowatts, a year-on-year increase of 6.2%; the cumulative average utilization hours of power generation equipment nationwide was 1,858 hours, an increase of 68 hours year-on-year.
In terms of policy, the National Development and Reform Commission and the National Energy Administration also recently jointly issued the "Notice on Actively Promoting Electricity Market-oriented Transactions and Further Improving the Trading Mechanism" (hereinafter referred to as the "Notice"), proposing to further accelerate the reform of the electric power system and accelerate the reform of the electric power system. Open up the power generation and consumption plan, accelerate the liberalization of power users other than users without bargaining power to participate in transactions, and expand the scope of market entities; In 2018, the power generation and consumption plan of power users in four industries including coal, steel, non-ferrous metals, and building materials will be liberalized, and all electric power will participate. Transactions, meeting electricity demand through market-based transactions, and establishing a market-based price formation mechanism and other specific requirements.
Analysts pointed out that the prosperity of the power industry continued to improve in the first half of this year, and the utilization hours of power generation equipment rebounded. It is expected that the growth rate of electricity consumption throughout the year will exceed expectations. In the long term, the "Notice" adopts "baseline electricity price + floating The market-based pricing model of "mechanism" will effectively promote the effective transmission of electricity prices upstream and downstream, and sales electricity prices are expected to rebound. In addition, market-based pricing will also introduce a healthy pattern of healthy competition to the industry. Leading companies are expected to rely on their strong bargaining power. To continue to benefit from the future market, investment opportunities in related themes are worth paying attention to.
"Securities Daily" Market Research Center found based on statistics that yesterday, the power sector achieved good performance, with the sector overall rising by 1.02 percentage points, ranking among the top in the Shenwan secondary industry. A total of 29 stocks in the sector achieved gains. They account for nearly 80% of all tradable stocks. Among them, three stocks including Hunan Development, Huadian Energy , and Jiangquan Industrial have reached their daily limit. Minjiang Hydropower (7.54%), Jinshan Shares (5.65%), Meiyan Jixiang (5.08 %) followed closely, with gains of more than 5% yesterday. In addition, including Huayin Power (4.75%), Binhai Energy (4.01%), Shennan Electric A (3.49%), Eight stocks including Huitian Thermal Power (3.47%) also rose by more than 3% yesterday.
In terms of capital flow, yesterday, the power sector as a whole showed a net inflow of large orders. Jiangquan Industrial (83.6681 million yuan) ranked first in net inflows of large orders yesterday, reaching more than 80 million yuan. Meiyan Jixiang (27.8634 million yuan), Three stocks including Huadian Energy (22.5566 million yuan) and Dongxu Blue Sky (20.0207 million yuan) were also actively pursued by large orders of more than 20 million yuan yesterday. In addition, Huaneng Hydropower (18.0816 million yuan), Minjiang Hydropower (1715.07 Ten thousand yuan), Laurel Power (14.1035 million yuan), Hunan Development (13.2329 million yuan) and other four stocks were also favored by large orders of more than 10 million yuan yesterday. The above eight stocks attracted a total of 217 million yuan. In terms of institutional ratings of
, in the past 30 days, a total of 16 stocks in the sector have been recommended by institutions. Among them, two stocks, Funeng Shares (5 companies) and Huaneng International (5 companies), have been rated as "overweight" by 5 or more institutions during the period. " or "buy" and other bullish ratings, Huadian International (4 companies), Guiguan Electric Power (3 companies), SDIC Power (3 companies), Lianmei Holdings (3 companies), Yangtze Power (3 companies) During this period, the number of institutions with positive ratings for the five stocks also reached 3 or more.
Regarding Huaneng International, Cinda Securities pointed out that the company's installed capacity has reached one trillion kilowatt hours in 2017, far exceeding other power generation platforms in terms of industrial scale and having an absolute leading advantage. In addition, under the background of supply-side structural reform and coal power overcapacity reduction, Huaneng International continues to increase its investment in clean energy and actively optimizes the power supply structure. In addition, the company has high-quality production capacity and a significant industry leading position, giving it an "overweight" Rating.
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Funeng Shares (Individual Stock Data Operation Strategy Stock Diagnosis)
Funeng Shares: Coal and Electricity Release Flexibility, The growth rate of the interim report is eye-catching
Funeng Shares 600483
Research institution: Shenwan Hongyuan Analysts: Liu Xiaoning, Wang Lu Date of writing: 2018-07-24
The acquisition of coal power has driven the growth of installed capacity, the efficiency of existing units has improved, and the company's revenue has increased significantly in 2018H1 increase. In Q1 2018, the company completed the acquisition of two coal-fired power projects, namely China Resources Wenzhou (20%) and China Resources Liuzhi (51%), with one participation and one control. Among them, China Resources Liuzhi has an installed capacity of 1.32 million kW. After the acquisition, the company's holding installed capacity has doubled compared to the end of 2017. times. In addition, electricity consumption in Fujian Province has grown rapidly since the beginning of the year. In 2018H1, the province's electricity consumption growth rate reached 13.62%, an increase of 9.95ppt compared with the same period last year. The company's holding subsidiaries Hongshan Thermal Power, Jinjiang Gas Power and New Energy Company generated electricity respectively year-on-year. Increases of 19.21%, 60.73% and 3.86%. Acquisitions drove the growth of installed capacity, and the efficiency of superimposed existing units was greatly improved. In 2018H1, the company achieved power generation of 8.755 billion kWh, a year-on-year increase of 101.11%. In the second half of 2017 and early 2018, Fujian Province raised the on-grid electricity prices for coal-fired and gas-fired power plants by 1.95 and 5.23 cents/kWh. The benchmark coal-fired on-grid electricity price in Guizhou, where China Resources Liuzhi is located, was lower than that in Fujian, which lowered the company's average electricity price. Therefore, the company achieved Revenue was 3.836 billion yuan, a year-on-year increase of 55.8%, which was lower than the growth rate of power generation.
's main business has steadily improved, and its participation in high-quality assets has contributed to investment income. In 2018H1, the company's net profit attributable to the parent company achieved high growth. The growth of Hongshan Thermal Power Generation and the increase in electricity prices have helped the company's profitability steadily improve. In addition, the company calculated the newly acquired 20% equity of China Resources Wenzhou as available-for-sale financial assets. In 18Q1, China Resources Wenzhou announced the distribution of cash dividends, and the company recognized investment income of 118 million yuan. In 2018H1, the company achieved a net profit attributable to the parent company of 407 million yuan, a year-on-year increase of 37.85%; considering that the company's 50 million yuan in proceeds from the sale of Sun Cable shares in the same period last year was non-recurring income, the company's net profit after deducting non-attributable shares to the parent company in 2018H1 increased by 60.47% year-on-year.
In the second half of the year, Jinjiang Gas and Electricity will begin to implement the replacement power policy, and the gas and electricity sector can expect full-year profits. The company's holding subsidiary Jinjiang Gas and Electricity is a policy peaking power plant that obtains subsidy income every year through the alternative power transfer indicators issued by the provincial government. In 2017, Jinjiang Gas and Electricity's alternative electricity quantity index was 2.486 billion kWh, and the gross profit from the transfer of alternative electricity was confirmed to be 538 million yuan. However, due to rising gas prices, Jinjiang Gas and Electricity's annual net profit was only 14.98 million yuan. In 2018, Jinjiang's gas-electricity replacement power indicator was 2.473 billion kWh, which was basically the same as in 2017, and all power was traded in the second half of the year. Taking into account that the electricity purchase cost of alternative electricity increased by 4 cents/kWh year-on-year (including tax, the same below), the on-grid electricity price increased by 5.23 cents/kWh year-on-year, and the superimposed value-added tax rate was reduced to 16%, it is expected that the gross profit of alternative electricity for the whole year will be 566 million yuan. . In June this year, the new gas and electricity policy was released. The on-grid electricity price for self-generated electricity in Jinjiang was raised to 0.5957 yuan/kWh, and the purchased gas price was lowered to 2.803 yuan/m3, which will be implemented retroactively from the beginning of the year. In 2017, the average on-grid electricity price of Jinjiang Gas and Power's self-generated power was about 0.543 yuan/kWh, and the average price of purchased natural gas was 2.86 yuan/m3. After the new policy adjustments, the company's self-generated power business profits will increase significantly, and the full-year net profit is expected to return to a reasonable level. The new rules for
online bidding have been released, so there will be no worries about electricity prices for projects put into production in the short term, which will benefit the company's operations in the long term. In May this year, the Energy Bureau released the "Notice on Relevant Requirements for Wind Power Construction Management in 2018", requiring that starting from 2019, all newly approved centralized onshore wind power projects and offshore wind power projects in each province should be allocated and determined through competition. Feed-in tariff. According to policy regulations, projects that have been approved so far will not be affected by the new bidding rules, and the benchmark electricity prices for wind power grids approved in the past will still be implemented. As of the end of 2017, the company had 423,000 kilowatts of wind power projects under construction and sufficient reserve projects. Therefore, the electricity price and rate of return of the company's new projects put into production in the next 2-3 years are still guaranteed. In addition, the proposal of the bidding system is expected to force the reduction of cost items such as wind power equipment, engineering and "roads". The company is the leader in wind power in Fujian Province. It is backed by the Fujian Provincial State-owned Assets Supervision and Administration Commission and the China Three Gorges Corporation. It has outstanding advantages in capital and project resources. Moreover, the company has many years of wind power operation experience, which has formed obvious scale advantages and stronger cost control capabilities than other small developers. .The company currently has more than 3 million kW of wind power in reserve. Considering the company's installation approval and production progress, we predict that the company's installed wind power capacity in operation will reach at least 1.54 million kW by the end of 2020, with a 132% growth potential compared to the current level.
Profit Forecast and Rating: We maintain our estimate that the company’s net profits attributable to the parent company from 2018 to 2020 will be 1.099, 1.319 and 1.546 billion respectively, corresponding to EPS of 0.71, 0.85 and 1.0 yuan/share, and the current stock price corresponding to PE of 11, 9 and 7 times . The company is the leader in clean energy in Fujian Province. The wind power sector has high growth potential. The installed capacity of the traditional thermal power sector has expanded significantly. Subsequent profits are expected to gradually recover, and the "buy" rating is maintained.
| : Qunyi Securities (Hong Kong) Research Institute Writing Date: 2018-07-20
Conclusion and Suggestions:
The company today released the power generation situation in the first half of 2018. In 2018, H1 completed power generation of 208.167 billion kilowatt hours, a year-on-year increase of 11.51%; the sale was completed The electricity volume was 196.387 billion kilowatt-hours, a year-on-year increase of 11.51%; the average on-grid settlement electricity price of each power plant in the first half of the year was 418.57 yuan/MWh, a year-on-year increase of 2.72%. In the second quarter of 2018, the power generation was 103.856 billion kWh, a year-on-year increase of 14.52%; the electricity sales were 98.075 billion kWh, a year-on-year increase of 14.54%.
predicts that the company will achieve net profits of 3.985 billion yuan (YOY+122%) and 5.435 billion yuan (YOY+36%) in 2018 and 2019 respectively, with EPS of 0.262 and 0.358 yuan. The current A-share corresponding to the dynamic PE in 18 and 19 is 27.6X , 20X, H shares 18X, 14X, giving a "buy" recommendation to A shares and H shares.
Power generation continues to grow, and the thermal power industry has bottomed out: From January to June 2018, the national power generation increased by 8.3% year-on-year, with a year-on-year growth rate of 2pct. The growth rate of power generation continues to increase. In addition, hydropower is likely to be dry this year, power generation has slowed down, and thermal power has To undertake more power generation, the national thermal power generation from January to June 2018 was 7,998.7 billion kilowatt-hours, a year-on-year increase of 7.7%.
Company accounts for 9% of the country's thermal power installed capacity, with high power generation and great flexibility: the company is the absolute leader in the thermal power industry, ranking first in the country's thermal power installed capacity, and its thermal power installed capacity accounts for 9% of the country's total thermal power installed capacity. In the first half of this year, power generation increased by 11.51% year-on-year, and electricity sales increased by 11.51% year-on-year. At the same time, due to the increase in the national benchmark coal price in July 2017 and the narrowing of the coal and electricity market transaction spread, the settled electricity price in the first half of the year was 418.57 yuan/MWh. , a year-on-year growth of 2.72%, high performance flexibility and significant growth.
Policies are strong, and coal prices are expected to stabilize and recover downward: We are currently facing the peak season for thermal coal demand, but coal prices have cooled down. Since June, coal prices have fallen slightly, and the price at Qinhuangdao Port has dropped from 705 yuan/ton to 680 yuan/ton. At present, the coal environmental inspection has been completed. The main production areas are expected to gradually resume production, and coal prices are expected to recover downwards. At the same time, policy control is strong, and the National Development and Reform Commission has made efforts to reduce the closing price of Q5500 North Port to 570 yuan/ton. Key coal companies Reduce long-term contract prices and improve the operating environment of power plants. The high coal price situation is unsustainable, and coal prices are expected to continue to decline in the future.
Profit Forecast: The company is expected to achieve net profits of 3.985 billion yuan (YOY+122%) and 5.435 billion yuan (YOY+36%) in 2018 and 2019 respectively, with EPS of 0.262 and 0.358 yuan. The current A-share trends correspond to 18 and 19 years. PE 27.6X, 20X, H shares 18X, 14X, giving a "buy" recommendation to A shares and H shares.
| ) Analyst: Qunyi Securities (Hong Kong) Research Institute Date of writing: 2018-07-12
The company announced the power generation situation in the first half of the year. The company's H1 generated a total of 20.576 billion kilowatt-hours of electricity, a year-on-year increase of 38.06%, of which 19.242 billion kilowatt-hours were hydropower. A year-on-year increase of 45.21%; thermal power was 1.051 billion kWh, a year-on-year decrease of 23.56%; wind power was 283 million kWh, a year-on-year increase of 1.80%. In terms of quarters, the cumulative power generation in Q2 was 114.97 kWh, a year-on-year increase of 60.80%.
Since the beginning of this year, the Guangxi basin has abundant water, and its performance is expected to grow steadily. The latest dividend rate is 6.10%. The company is expected to achieve net profits of 2.795 billion yuan (YOY+11.31%) and 2.833 billion yuan (YOY+1.37%) in 18 and 19 respectively. , EPS are 0.46 and 0.47 yuan respectively. The current stock price corresponds to PE of 12X and 12X in 2018 and 2019 respectively. The valuation is relatively low. It gives a PE of 15 times in 2018, corresponding to a target price of 6.9 yuan, and gives a "buy" recommendation.
Datang Group’s hydropower listed platform, high-quality hydropower assets: The company is the only hydropower listed platform of Datang Group. Currently, the company has an installed hydropower capacity of 9.255 million kilowatts, a thermal power installed capacity of 1.33 million kilowatts, and a wind power installed capacity of 281,500 kilowatts. The company owns the hydropower development rights in the Hongshui River Basin in Guangxi. Its Longtan Hydropower Station has an installed capacity of 4.9 million kilowatts, making it the fourth largest hydropower station in the country. The company's installed hydropower accounts for more than 50% of Guangxi's installed hydropower capacity. It is a high-quality local hydropower faucet.
The water supply continues to improve, and the growth of power generation is highly elastic: Since the beginning of this year, the water potential in Guangxi has been good, and the company's power generation has achieved high growth. H1 has achieved a cumulative power generation of 20.576 billion kWh (YOY+38.06%), of which 19.242 billion kWh was hydropower ( YOY+45.21%), thermal power 1.051 billion kWh (YOY-23.56%), wind power 283 million kWh (YOY+1.80%). In terms of quarters, the power generation in Q1 was 9.079 billion kilowatt-hours (YOY+26.98%), and the power generation in Q2 was 11.497 billion kilowatt-hours (YOY+60.80%). The power generation in each basin is increasing quarter by quarter with abundant rainwater, and is expected to reach the level from July to September. With the peak of water resources and the company's enhanced comprehensive dispatching capabilities in river basins, total power generation is expected to grow steadily this year.
high dividend and high dividend rate: The company paid a cash dividend of 3.3 yuan for every 10 shares in 2017, with a total dividend of 2.001 billion yuan, and a dividend rate of 80%. The company's three-year average dividend rate is 60%. The dividend is stable. If based on today's closing price According to calculations, the latest dividend rate has reached 6.08%, which is significantly higher than similar listed hydropower companies. The company has entered a stage of stable operation, with low capital expenditure, and is expected to maintain high dividends in the future.
Profit Forecast: Since the beginning of this year, the Guangxi basin has abundant water, and its performance is expected to grow steadily. The latest dividend rate reaches 6.10%. The company is expected to achieve net profits of 2.795 billion yuan (YOY+11.31%) and 2.833 billion yuan (YOY+) in 2018 and 2019 respectively. 1.37%), with EPS of 0.46 and 0.47 yuan respectively. The current stock price corresponds to a PE of 12X in 2018 and 2019. The valuation is relatively low. It gives a PE of 15 times in 2018, corresponding to a target price of 6.9 yuan, and gives a "buy" recommendation.
| Analysts: Liu Xiaoning, Ye Xuchen, Wang Lu Writing date: 2018-06-21
Event:
The company announced on June 14 that Unit 4 (1 million kilowatts) of the company's holding subsidiary SDIC Beijiang Phase II Project will be closed in June 2018. It passed the 168-hour trial operation on March 14 and was officially put into commercial operation.
Investment points:
The second phase of SDIC Beijiang Project was put into operation, and the structure of the company's thermal power units was further optimized. The company's holding subsidiary (64% shareholding) SDIC Beijiang is responsible for the construction and operation of 4×1 million kilowatt ultra-supercritical coal-fired generating units. Units 1 and 2 have been completed and put into operation. They are one of the few remaining units of the company in 2017. Maintain profitable thermal power units. The units put into operation this time are the second phase of the expansion project, and combined with the second phase of Meizhou Bay (2×1 million kW) that was put into operation in the second half of 2017, the company's thermal power installed capacity has expanded significantly. As of now, the company's thermal power installed capacity is 14.756 million kW, accounting for approximately 45% of the company's total installed capacity. In addition, SDIC Beijiang Unit 3 was connected to the grid for the first time in May and is expected to be put into operation in the near future. At present, the company has no units below 300,000 kW. Thermal power units with large single-scale power supply have low coal consumption, high power generation efficiency and cost efficiency advantages. After SDIC's Beijiang units are all put into operation, the company's one-million-kilowatt units will reach half of the thermal power installed capacity of the controlling shareholder, further optimizing the company's thermal power installed capacity structure.
html Thermal power performance in 2017 was dragged down by coal prices and power generation efficiency. The improvement in power generation efficiency in 2018 brought performance flexibility. Since the second half of 2016, the price of thermal coal across the country has continued to rise. In 2017, most of the thermal power companies in which the company participated have suffered losses to varying degrees. In 2016, the company's thermal power units located in Guangxi and Fujian were affected by local hydropower, and the power generation efficiency dropped sharply. In 2017, affected by the commissioning of new units, the company's thermal power units achieved a utilization hour of 3543h, a low in recent years. In 18Q1, benefiting from the recovery in electricity demand, the overall rainfall in the superimposed area was dry, and the hydropower load decreased. The utilization hours of the company's thermal power units increased by 205 hours year-on-year. According to estimates, regardless of changes in coal prices and new units put into operation this year, if thermal power utilization hours increase by 400 hours year-on-year in 2018 (the utilization hours have not yet returned to 2015), the company's overall performance elasticity will reach 11.8%; many provinces will increase the on-grid electricity price of coal power in 17H2 , after taking into account the performance increase brought about by electricity price adjustments, the company's full-year performance elasticity is expected to reach 16.6%.When the development of the midstream of the Yalong River is in progress, the production peak will be ushered in during the "14th Five-Year Plan" period. The company owns the development rights for the entire Yalong River basin and currently controls a hydropower installed capacity of 16.72 million kilowatts. The developable scale of the Yalong River Basin is about 30 million kilowatts. The company plans to implement the Yalong River hydropower development plan in four phases. At present, Yangfanggou and Lianghekou hydropower stations in the middle reaches of the Yalong River have been approved to start construction, with a total installed capacity of 4.5 million kilowatts. It is planned to start in It will be put into production between 2021 and 2023. The preliminary work of the other five power stations in the midstream is being effectively advanced. The proposed projects total 7.3 million kilowatts. It is expected that the company's hydropower installed capacity will reach 28.52 million kilowatts in 2025. In addition, the company has launched the upstream "Ten Levels of One Database" plan, totaling 2.4 million kilowatts, which will become the main installed capacity increase after the "14th Five-Year Plan". The company's hydropower development is progressing as planned, and the installed capacity growth is highly certain, which will start a new round of rapid growth.
The water supply continues to improve, and the company's hydropower performance in 2018 is stable and improving. In the first half of 2018, the water supply in southern my country continued to improve. From January to April, the national hydropower generation increased by 1.3% year-on-year, an increase of 5.8 percentage points from the same period last year. The hydropower generation in Guangxi, Hubei, and Sichuan increased by 16.3%, 5.4%, and 5.4% year-on-year. 3.5%. The Yalong River basin where the company's hydropower units are located continues to benefit, and it is expected that the company's hydropower generation output will be stable and improve in the first half of the year.
Profit Forecast and Rating: Taking into account factors such as water supply, coal prices, electricity supply and demand, we have raised the company's net profit forecast for 18 to 20 years to 3.95 billion yuan, 42.1 billion yuan, and 4.5 billion yuan respectively (before adjustment, they were 34.3 yuan, 36.4 yuan, and 39.1 yuan respectively. billion), corresponding to PEs of 13, 12 and 11 times respectively. Yalongjiang's performance is stable and has growth potential in the medium and long term. Thermal power profitability is at a low point. The power generation efficiency of the thermal power sector has improved significantly this year and earnings may exceed market expectations. The rating was raised from "overweight" to "buy".
| , written by Zhou Zhe Date: 2018-07-17
The installed capacity continues to increase, and the global hydropower leader is ushering in a golden age: According to the announcement, the company is the largest listed hydropower company in China, with the operation of large hydropower stations as its main business. In 2016, the company completed the acquisition of Chuanyun Company and injected 20.26 million kilowatts of core assets ( Xiangjiaba and Xiluodu Hydropower Station ). As of the end of 2017, the company's installed capacity reached 45.495 million kilowatts, ranking first in the world. The power generation in 2017 was 210.89 billion kilowatt-hours, accounting for 17.7% of the country’s hydropower generation.
Hydropower business reached a new high, and the four-reservoir joint dispatch was impressive: the company successively raised the banners of SDIC Power and Sichuan Energy, using equity and technology as dual links to lay the foundation for the company's joint cascade dispatch. With the Xiluodu Reservoir as the leader and the Three Gorges Reservoir as the core, the company scientifically carries out "four-reservoir joint regulation" to smooth the fluctuations in water inflows in the basin. In recent years, water conservation and power generation have exceeded 9 billion kilowatt hours.
has high dividends and high dividend rates, and the allocation value is highlighted: the company has maintained a high level of cash dividends since its listing in 2003. The company promises that the cash dividend per share from 2016 to 2020 will be no less than 0.65 yuan, and the annual cash dividend from 2020 to 2025 will not be less than 70% of the net profit achieved in that year. The company's dividend rate is also at the forefront of the industry, exceeding the A-share market and mid- and long-term treasury bond yields in the long term. Considering that the capital expenditure during the operation period of hydropower projects is small, it is expected that the high dividend rate and high dividend rate may be sustainable, further highlighting its allocation value.
's international business is booming, and its capital operation has expanded its territory: the company's capital operation technology is skillful, and its investment performance is obvious to all. In 2016, the Jinshajiang Asset Restructuring Project raised RMB 24.16 billion from the capital market and issued 5 tranches of domestic debt financing instruments. Some of the coupon rates hit a record low for comparable bonds, creating a high-quality brand image of "Yangdong Electric Bonds". In addition, the company actively expanded overseas capital markets, participated in overseas capital markets for the first time, and successfully issued dual-currency exchangeable bonds of US$300 million and €200 million. In 2016, the company was involved in an overseas wind power project for the first time. It jointly invested with China Three Gorges International in the Meir offshore wind power project in Germany and obtained a 30% stake. In March 2017, it received a project investment income of 12.6 million euros, with a cash return rate of 6.5% and an internal rate of return of the project. 8%, a good start.
investment advice: Overweight -A investment rating, 6-month target price of 18.2 yuan.We estimate that the company's revenue growth from 2018 to 2020 will be 2.2%, 1.4%, and 1.4% respectively, and its net profits will be 21.15 billion, 21.56 billion, and 21.81 billion yuan respectively. We are optimistic about the company's cash flow and high dividends.
Risk warning: The growth of electricity consumption in the whole society is less than expected; the water supply is less than expected; there is a risk of downward pressure on on-grid electricity prices.
| Power 300274
Research institution: Pacific Analysts: Zhou Tao, Liu Jingmin, Shao Jingxin Date of writing: 2018-05-09
The main business of inverters has developed steadily, and it has been relatively stable at home and expanded rapidly abroad. The company's inverters have always maintained a leading position in the industry in terms of shipment volume, with a domestic market share of close to 30%. In addition, photovoltaic inverters are currently not included in the dual inverters. Since the company's listing, overseas market revenue has increased year by year, and accounts for The proportion of total revenue has remained stable. In 2017, the company's inverter shipments were 16.5GW, including 3.3GW in overseas markets. It is expected that with the company's further expansion of overseas markets in 2018, overseas business is expected to ship 4-5GW, an increase of 50%-100%.
Power station business has grown rapidly, with obvious advantages in poverty alleviation and household use. The company's power station business has developed rapidly in recent years. As for the leader, the company obtained the "Top Runner" advanced technology product certification for photovoltaic inverters in September 2017, and also won the bid for the Weinan and Datong bases among the third batch of leader bases. In terms of photovoltaic poverty alleviation, the company has successfully connected several photovoltaic poverty alleviation demonstration projects to the grid. These projects are mainly distributed in 11 poverty-stricken counties and districts in five provinces: Anhui, Shandong, Hubei, Jiangxi, and Hebei. The total installed capacity of the project exceeds 470MW. The largest projects include Macheng 70MW in Hubei and Yuan 70MW in Anhui. The smallest household power station is only 3kW. Each project has become an important window demonstration project for targeted poverty alleviation in the county where it is located due to its precise poverty alleviation model and high-level engineering quality. . In terms of household use, the company has established the SunHome global brand to focus on the household photovoltaic market. According to the company's plan, its channels will achieve three-dimensional network coverage at the city, county and town levels, and will achieve agent network coverage in 10 provinces in the short term. It is expected to form a 1,000 county-level distribution network by the end of 2018. In the next 2-3 years, we will reach a county-level distribution network of 3,000 stores and a township and village network of 100,000 stores. By 2020, we will achieve the goal of ranking first in China's household photovoltaic market share. Sungrow is expected to have 30,000-50,000 household installations in 2018.
is the pioneer of energy storage, and the domestic market is about to explode. With the help of Samsung's world-leading energy storage technology, the company has joined forces to make Sungrow take a key step on the road of energy storage inverters. As a new business, the company's energy storage revenue has made great progress in just one year since 2016. According to the company's 2017 annual report, the revenue from energy storage inverters during the reporting period was close to 65 million. To develop the market, technology comes first. With the huge domestic market, the company has great development potential in the energy storage business, and the first-mover advantage is very obvious.
Profit Forecast: As a leading company in photovoltaic inverters, the company has still relied on its technical and cost advantages to survive the multiple rounds of reshuffles in the photovoltaic industry. It has also expanded its business to wind power, energy storage and new technologies through technological synergy and market synergy. The field of energy vehicles has laid a good foundation and performance growth driver for the company's long-term development. As the photovoltaic industry approaches grid parity, the overall valuation of the industry is fully upward. As a leading company in the photovoltaic industry, the company should enjoy a certain valuation premium. We estimate that the company's net profit from 2018 to 2020 will reach 1.406 billion yuan and 1.818 billion yuan. yuan and 2.229 billion yuan, corresponding to price-earning ratios of 18 times, 14 times and 11 times respectively. Initiated coverage with a "buy" rating.
Risk warning: The company's inverter shipments are not up to expectations, the power station business is not up to expectations, and there are policy risks in the photovoltaic industry.
