Huaneng International (600011): double the length of power generation in the second quarter; electricity price, single fuel improvement or profit growth

Company dynamics Huaneng International released operating data for the second quarter of 2019: power generation in the second quarter, and electricity sales replaced location 11.

9% / 11.

5% to 915/868 billion kWh.

In the first half of 2019, the amount of electricity generated during the first half of the year was 6 at both ends of the electricity sales.

2% / 5.

8% to 1,954 / 185 billion kWh.

In terms of electricity price, the average on-grid electricity price in 1H19 increased by 0 every year.

22% to 419.

51 yuan / MWh.

The company’s settlement market-based electricity generation capacity was 87.6 billion kWh, accounting for 47% (the extension increased by 10.

.

15 averages).

Comment on the double-precision value of power generation in the second quarter, slightly less than expected.

In the second quarter, the company’s power generation exceeded the expected upper limit by 12%, and the decline exceeded our expected replacement range by 7-8%.

Based on the installed data at the end of the first quarter, we estimate that the company’s utilization hours will be about 864 hours in the second quarter, a 13% decline each year.

Looking at the first half of the year, the company’s power generation capacity is at regular intervals6.

15%, the comprehensive utilization hours of about 1,874 hours, a decline of 8% each year.

In terms of provinces, in the 天津夜网 first half of the year, Fujian, Guangdong, and Yunnan in the southeastern provinces generated the most electricity, once at -25% /-25% /-23%.%).

In the central and western provinces, Guizhou, Hubei, and Chongqing accelerated the growth of power generation in the first half of the year, repeatedly + 28% / + 20% / + 15% (2Q19: -11% / + 14% / + 39%).

In the first half of the year, electricity prices rose by 0 each year.

2%, bringing the tax-free electricity price in the second quarter or a year-on-year increase of 3.

5%.

In the first half of the year, the company’s overall average on-grid price was 419.

5 yuan / MWh, a zero increase in ten years.

2%.

Compared to the first quarter, the on-grid electricity price is reduced by 0 every year.

4% to 421.

9 yuan / MWh, we estimate the on-grid price in the second quarter to be 416.

8 yuan / MWh, rising by 0 every year.

8%.

At the same time, considering that the quarterly growth rate in the second quarter of this year has been reduced by 3 units, we expect that the electricity price without tax or more than 3 in the current quarter.

5%, better than expected.

The improvement rate and the obvious increase in wind power generation have made up for the impact of the expansion of the market electricity proportion on electricity prices.

Consolidated fuel costs are down, and we expect the company’s profit in the first half of the year to increase by 87%.

Estimates suggest that we maintain our 2019/20 profit forecast at zero expected net profit.

39/0.

49 yuan.

Huaneng International-A / H is currently trading in 16/2019.

3/10.

8 times price-earnings ratio, 1.

1/0.

8 times P / B and 4.

3% / 6.

5% dividend yield.

Maintain Huaneng International-A / H “Outperform” rating with target price of 8.

RMB 29 / HKD 6.

00 yuan, corresponding to the current sustainable 30% / 28% upside.

Huaneng International-A / H target price implied 21 of 2019.

2/13.

8 times price-earnings ratio, 1.

4/1.

0x P / B and 3.

3% / 5.

1% dividend yield.

Risks Coal price fluctuations, electricity demand is less than expected