\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 011 Huaneng Power International Inc(600011) )
Recommendation logic: 1) with the control of coal price and the rise of electricity price, the company's thermal power business] is expected to turn losses into profits in 22 years, and the value of thermal power is expected to be revalued; 2) The rapid development of new energy has opened up room for growth. In the 14th five year plan, the installed capacity of scenery is 55gw, and the CAGR will reach 39% in 20-25 years. The installed capacity growth rate, projects under construction, kwh profit and other indicators are leading in the industry; 3) The synergy effect of thermal power new energy is significant. The total operating cash flow and depreciation in 20 years exceed 60 billion, which provides sufficient capital for the development of new energy. Multi energy complementarity brings advantages to the project.
China's largest power operator has a high position of ensuring supply. The company's thermal power business is expected to turn loss into profit in 2022. In 2021, the company's total installed capacity reached 118.7gw, with thermal power accounting for 88.0%. It is the largest electric power enterprise in China and undertakes the important responsibility of national energy security and supply. The national development and Reform Commission requires that in addition to imported coal, the power coal in 22 years will realize 100% long-term cooperation, and the long-term cooperation coal price will be controlled in the range of 570770 yuan / ton. With the continuous promotion of coal production and supply guarantee and the high proportion of electricity price, the company's thermal power business is expected to turn losses into profits in 2022.
Thermal power is the leader in new energy transformation, with fast installed capacity growth, high-quality stock assets and leading industries in many indicators. The company began to transform into new energy in 2015, and the installed capacity of Fengguang increased from 5.4gw to 13.8gw in 20172021. The company actively develops offshore wind power. The installed capacity of offshore wind power reaches 2.0gw, accounting for 19.1%. The company's new energy installation target of the 14th five year plan is 55gw. In 2021, the installed capacity of Fengguang will increase by 3.2gw. In the future, the installed capacity of Fengguang will increase by about 10GW every year, and the growth rate and planning target are in the first echelon. Many indicators are leading in the industry. By the end of 2021, the scale of projects under construction of the company was 50.1 billion yuan, ranking first in the industry. Meanwhile, in 2021, the company's new energy kwh profit was 0.21 yuan / kWh, an increase of 0.04 yuan / kWh year-on-year, which is at the leading level in the industry.
The business synergy is significant. Thermal power provides sufficient capital for the development of new energy, and the peak shaving ability brings advantages to the acquisition of new energy projects. As a thermal power transformation enterprise, the operating cash flow and depreciation amount of the company in the past 20 years are the first in the industry, with 42.1 billion and 21 billion respectively, which can provide sufficient capital for the development of new energy of the company. At the same time, the company's financing cost has decreased year by year. In 22 years, the average interest rate of short-term bonds and medium-term notes issued by the company was only 2.02% and 3.29%. The bidding of multi provincial new energy projects requires supporting thermal power flexibility transformation indicators, which can realize multi energy complementarity and independent peak shaving. Enterprises have significant advantages in obtaining new energy projects.
Valuation and rating: as the leader of thermal power transformation and new energy, the company has scale effect and business synergy. We give the thermal power sector 0.8 times Pb valuation in 22 years, corresponding to the market value of 54 billion yuan, and the new energy sector 21 times PE valuation in 22 years, corresponding to the market value of 81.9 billion yuan. To sum up, we expect the total market value of the company in 2022 to be 135.9 billion yuan, corresponding to the target price of 8.65 yuan. It is covered for the first time and given a "buy" rating.
Risk warning: coal price and electricity price fluctuation risk; Risk that the project is put into operation faster than expected; Asset spin off risk.
