\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 674 Sichuan Chuantou Energy Co.Ltd(600674) )
Core view:
Event:
The company released the annual report of 2021, and achieved an operating revenue of 1.263 billion yuan, a year-on-year increase of 22.52%; The net profit attributable to the parent company was 3.087 billion yuan (excluding 3.024 billion yuan), with a year-on-year increase of – 2.35% (excluding an increase of – 0.46%). On the same day, the company released the first quarterly report of 2022. In the first quarter, the operating revenue was 174 million yuan, a year-on-year increase of – 18.18%; The net profit attributable to the parent company was 558 million yuan (excluding 553 million yuan), a year-on-year increase of – 13.69% (excluding – 14.13%).
Yangfanggou and Lianghekou were put into operation for power generation, and new energy and hydropower projects continued to expand
In 2021, all four units in Yangfanggou and five of the six units in Lianghekou will be put into operation successively (the other one will be put into operation in March 2022). The installed capacity of the company’s participation and holding reached 34.63gw (excluding China Three Gorges Renewables (Group) Co.Ltd(600905) and CGN wind power, year-on-year + 17.6%), and the installed capacity of equity reached 12.52gw (year-on-year + 28%). In addition, the company invested more than 1.7 billion yuan in CGN wind power project to expand the territory of new energy industry; Completed the acquisition of 20% equity of Tingzikou company and 71% equity of Yutian company, and expanded high-quality hydropower projects; The progress of Jinsha River Yinjiang Hydropower Station exceeded expectations and the closure of the river was realized one year ahead of schedule.
In 2021, the company’s total operating revenue increased by 232 million yuan year-on-year, mainly due to the addition of three hydropower companies consolidated in July 2020, resulting in a year-on-year increase of 224 million yuan in the revenue of Sichuan investment power in 2021; The net profit attributable to the parent company decreased by 742575 million yuan year-on-year, mainly because the net profit of the subsidiary Tianwan River decreased by 50.072 million yuan year-on-year due to the treatment of Renzonghai dam, and the income from asset disposal of the subsidiary Jiayang power decreased in the current period, with the net profit decreased by 172894 million yuan year-on-year; The investment income was 3.335 billion yuan, an increase of 25 million yuan year-on-year.
In the first quarter of 2022, the company’s revenue decreased by 39 million yuan year-on-year, mainly due to the reduction of 51 million yuan in the current operating revenue of the subsidiary Tianwan river due to the treatment of Renzonghai dam; The net profit attributable to the parent company decreased by 89 million yuan year-on-year, mainly due to the year-on-year decrease of 20.072 million yuan in investment income, the decrease of 394483 million yuan in total profit of the subsidiary Tianwan river due to Renzonghai dam treatment, and the year-on-year increase of Guangzhou Hi-Target Navigation Tech Co.Ltd(300177) million yuan in financial expenses of the parent company.
The net operating cash flow increased significantly
In 2021, the gross profit margin of the company’s sales was 41.91%, a year-on-year decrease of 4.61 percentage points, mainly due to the year-on-year decrease of 4.55 percentage points in the gross profit margin of power business; The net operating cash flow was 547 million yuan, with a year-on-year increase of 38.04%, mainly due to the year-on-year increase in cash received by the subsidiaries of Sichuan investment power and Jiaotong University. In 2022, the net operating cash flow was 110 million yuan, with a year-on-year increase of 254.8%.
All 6 units in Lianghekou were put into operation, and the construction of a new batch of Yazhong power station was carried out in an orderly manner
In March 2022, the last unit in Lianghekou was put into operation, so far, all 6 units in Lianghekou have been put into operation for power generation. Lianghekou Hydropower Station is a cascade hydropower station in the middle reaches of the Yalong River. It has the largest reservoir in the Yalong River Basin, with a total storage capacity of 10.8 billion cubic meters. After the impoundment of the reservoir, through scientific regulation, compensation and regulation, the power generation of the middle and lower reaches of hydropower stations in the dry season can be increased by 22.5 billion kwh without increasing material investment.
The construction of a new batch of Yazhong hydropower stations was carried out in an orderly manner. At present, mengdigou and Kara hydropower stations are under construction, with a total installed capacity of 3.42gw, and are expected to be put into operation during the Tenth Five Year Plan period. According to the strategic planning of Yalong River hydropower company, 4-5 main cascade hydropower stations in the middle reaches (including the completed Yangfanggou and Lianghekou) will be built by 2030. The total installed capacity will reach more than 23gw by 2030, which still has 20% growth space compared with the current.
Yalong River new energy project is expected to break through and become a new performance growth point
In the 14th five year energy development plan of Sichuan Province, it is proposed to accelerate the development of wind power and Cecep Solar Energy Co.Ltd(000591) power generation, and plan to build a comprehensive renewable energy development base integrating water and scenery in the upper reaches of Jinsha River, the lower reaches of Jinsha River, Yalong River and the middle and upper reaches of Dadu River. Yalong River Basin is rich in scenery resources, with a scale to be developed of more than 40gw. Relying on the dispatching and regulation of cascade hydropower stations such as Lianghekou, it can effectively smooth the fluctuation of scenery output and improve the utilization rate of scenery.
According to the company’s annual report, Yalong river company has steadily promoted the M & A and development of wind power and photovoltaic power generation projects along the river. After successfully acquiring Dechang wind power company, it has obtained the approval of labashan wind power project in Dechang County, and established Yalong River Yanyuan new energy Co., Ltd. to develop Yanyuan County new energy project. It is expected that the riverside scenery project is expected to make a breakthrough, further thicken the company’s investment income and become a new performance growth point.
Valuation analysis and rating description
It is expected that Yalong river company’s new energy along the river will open up new growth space, and the equity installed capacity of the company will reach 14-15gw at the end of the 14th five year plan. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 3.669 billion yuan, 4.019 billion yuan and 4.240 billion yuan respectively, and the corresponding PE will be 13.14 times, 11.99 times and 11.37 times respectively. For the first coverage, give a “recommended” rating.
Risk tips:
The water inflow is lower than expected; On grid tariff reduction; The expansion of new energy projects is less than expected; Insufficient consumption capacity leads to the increase of waste water.
