Changyuan Power (000966): Growth in power generation overlaps with falling coal prices. Company performance pre-increases by 178%?237%
Event: On October 10, the company released the 2019 third quarter performance forecast, which is expected to return to its mother net profit for the first three quarters of 19 4.72?5.720,000 yuan, +178 for ten years.twenty four%?237.19%, earnings per share are 0.426?0.516 yuan / share; 19Q3 returns to net profit of the mother 2.17?3.1.7 billion, +49 a year.15%?117.88%, earnings per share are 0.196?0.286 yuan / share.Our comments are as follows: The increase in power generation and the decline in coal prices are driving growth.There are three reasons for the expected growth of the company’s performance: 1) Growth in power generation: 1 in 19?In September, the company completed 144 generations.1.8 billion degrees, +15 for ten years.71%, the major increase in power generation is mainly driven by the strong demand for electricity in Hubei Province, where the company is located.Hubei ‘s power consumption in August was 149.5 billion kWh, at least +8.21%, the growth rate is much higher than the previous growth rate of electricity consumption4.45%.At the same time, the average utilization time of Hubei thermal power equipment was 3200 hours, an increase of 281 hours (+9.63%), the utilization of thermal power equipment nationwide during the same period was 2831 hours, continuous -107 hours.2) Coal price decline: 1 in 19In September, the average closing price of Qinhuangdao Port Powered Coal (Q5500) was 598 yuan / ton, each time -8.32%.The company’s fuel cost / operating cost is about 60% (64% in 18 years), and its performance is highly sensitive to coal prices.3) In the first half of the year, the on-grid electricity price has risen every year: The company’s 19H1 comprehensive on-grid electricity price without tax is calculated to be 0.370 yuan / kilowatt-hours, rising by 0 every year.009 yuan / kWh. The market electricity price has shown a convergence trend compared with the benchmark electricity price. The market-based electricity price will help the thermal power industry’s profit forecast to be more stable.Since the advancement of electricity marketization, bidding has gradually become more rational, and the market electricity price has shown a convergence trend compared to the benchmark electricity price.On September 26, the executive meeting of the State Council proposed to abolish the coal-electricity price linkage mechanism, and change the existing benchmark on-grid electricity price mechanism to a “benchmark price + floating up and down” marketization 深圳spa会所 mechanism.From a medium-to-long-term perspective, canceling the benchmark electricity price and replacing the market-based mechanism of “base price + up and down” does not mean unilaterally suppressing the price of electricity, but rather guarantees that the price of electricity changes within a reasonable range (up to 10% for upswings and not more than for downsizing principles)15%).Marketization of electricity prices in the future will help thermal power earnings to be more stable. Coal price volatility has led to the thermal power sector market, and it is expected that there will be downward pressure on coal prices in the medium and long term.Judging from the market resumption, thermal power market growth is usually driven by the decline in coal prices.In the medium and long term, the trend of coal prices is expected to 北京夜生活网 fall under the background of increasing land financing supervision and tightening under the condition of “no housing and speculation”, while coal prices are under pressure due to the tendency of coal production capacity to concentrate on high-quality production sites. Investment suggestion: Give a prudent overweight rating.The company’s thermal power units are located in Hubei Province, and the country’s regional power consumption growth and thermal power supply and demand are arranged nationwide. Under the downward trend of coal prices, the company’s performance promotes further improvement.We estimate that the company’s net profit attributable to its parent for 2019-2021 will be 6.17, 8.05, 8.7.4 billion, the previous growth rate was 195.63%, 30.41%, 8.67%, corresponding to the PE estimate of 9 on October 10.0, 6.9,6.Three times, given a “prudent overweight” rating.Risk reminder: the risk of electricity price reduction, the risk of decline in utilization hours, and the risk of coal price fluctuations