Market review: from February 28 to March 5, the power sector (882528. WI) rose 2.37%, the CSI 300 index fell 1.68%, and the power sector outperformed the CSI 300 index by 4.05 percentage points. Since the beginning of 2022, the power sector has fallen by 3.70%, the Shanghai and Shenzhen 300 index has fallen by 8.99% over the same period, and the power sector has outperformed the market by 5.28 percentage points since the beginning of the year. In terms of molecular sectors, thermal power, hydropower and gas sectors (CITIC index) rose or fell by 1.62%, 4.35% and 0.51% respectively from February 28 to March 5
Qinhuangdao coal price remained unchanged month on month, with a year-on-year increase of 62.77%
On March 4, the market price of 5500 kcal thermal coal in Qinhuangdao was 940 yuan / ton, which remained unchanged month on month, with a year-on-year increase of 62.77%; On March 4, the comprehensive average price of 5500 kcal of Bohai Rim thermal coal index was 740 yuan / ton, which remained unchanged month on month, with a year-on-year increase of 28.03%. In terms of futures, the thermal coal contract delivered by Zhengzhou Commodity Exchange in May 2022 quoted 852 yuan / ton on February 25, 87.8 yuan / ton higher than the spot price.
QinGang inventory rose 0.92% month on month, down 14.06% year-on-year
In terms of coal inventory, as of March 5, the inventory of QinGang port was 4.95 million tons, an increase of 45000 tons month on month, an increase of 0.92%, a year-on-year decrease of 810000 tons, a decrease of 14.06%. The inventory of Guangzhou Port Company Limited(601228) March 4 was 2.2 million tons, an increase of 120000 tons month on month, an increase of 5.77%, a year-on-year decrease of 777000 tons, a decrease of 26.1%.
Weekly views and investment suggestions
Recently, Premier Li Keqiang made a government work report, in which he proposed to strengthen the guarantee of supply and stable price of bulk commodities and strive to solve the problem of tight supply of coal and electricity. At the same time, the target of energy consumption intensity will be comprehensively assessed during the 14th Five Year Plan period, with appropriate flexibility. The new renewable energy and raw material energy will not be included in the total energy consumption control. We believe that the relevant statements are conducive to promoting the continuous implementation of the long-term coal cooperation mechanism, ensuring that the fuel cost of thermal power enterprises will not fluctuate as violently as last year, the coal supply and demand pattern is expected to continue to improve, and the profit of thermal power assets is expected to return to a reasonable range. The report also mentioned to clean up unreasonable price increases in power transfer links and support local governments to implement phased preferential policies for power consumption in industries with special difficulties. This part mainly involves the distribution and sale of electricity. In essence, it is still necessary to promote the market-oriented electricity price mechanism to avoid charging a price increase significantly higher than the distribution cost on the power consumption side, which has no significant impact on the on grid electricity price on the power generation side. Overall, the report has made a long-term layout for the transformation of energy structure and clean utilization of coal. In terms of electricity, we are still optimistic about the targets of thermal power transformation and new energy operation, including Shanghai Electric Power Co.Ltd(600021) , Huaneng Power International Inc(600011) , Jilin Electric Power Co.Ltd(000875) , Fujian Funeng Co.Ltd(600483) and China Resources Power. Pure new energy operation company suggests paying attention to Zhongmin Energy Co.Ltd(600163) . In addition, we also recommend Suwen Electric Energy Technology Co.Ltd(300982) , an enterprise integrating operation and maintenance of intelligent power distribution projects, and we suggest paying attention to wubai power station, which is expected to inject China Yangtze Power Co.Ltd(600900) , a hydropower leader to improve the company’s profitability, and Huaneng Lancang River Hydropower Inc(600025) , which benefits from the continuous improvement of market electricity price in the province. In terms of natural gas, we recommend increasing gas sales. Xinao energy, Shenzhen Gas Corporation Ltd(601139) , an urban gas company with its own LNG terminal, is recommended.
