Company Reports

China Gas Holdings, or CGH, is involved in the wholesale and retail businesses of natural gas and liquefied petroleum gas, or LPG, in China. The firm benefits from exclusive city gas concession rights and efficient scale. In the past, CGH aggressively expanded into rural city gas projects, resulting in a stretched balance sheet compared with its peers. The firm now focuses on the asset-light value-added services, and integrated energy businesses.

China Gas Holdings’ fiscal 2026 (ended March) net profit fell 16%. Most guidance was met, except for weaker value-added services, or VAS, earnings due to soft consumer sentiment, property headwinds, and raw material costs. Full-year dividend per share, or DPS, was cut 30% to HKD 0.35.

ENN Energy’s 2025 core profit fell 3%, reflecting subdued retail gas and integrated energy sales volumes. China Resources Gas saw a similar trend, with net profit declining 13%. New residential connections dropped 14%-20% for both companies.

China Gas Holdings, or CGH, is involved in the wholesale and retail businesses of natural gas and liquefied petroleum gas, or LPG, in China. The firm benefits from exclusive city gas concession rights and efficient scale. In the past, CGH aggressively expanded into rural city gas projects, resulting in a stretched balance sheet compared with its peers. The firm now focuses on the asset-light value-added services, and integrated energy businesses.

China Gas Holdings’ first-half fiscal March 2026 net profit fell 24% year on year, mainly due to weaker contributions from associates and joint ventures, lower other income, and reduced connection profit.

China Gas Holdings, or CGH, is involved in the wholesale and retail businesses of natural gas and liquefied petroleum gas, or LPG, in China. The firm benefits from exclusive city gas concession rights and efficient scale. In the past, CGH aggressively expanded into rural city gas projects, resulting in a stretched balance sheet compared with its peers. The firm now focuses on the asset-light value-added services, and integrated energy businesses.

For the first nine months of 2025, China's apparent natural gas consumption fell 0.2% year on year. The country's slowing economic growth has placed pressure on sales volumes of China gas utilities.

China Gas Holdings’ fiscal 2025 (ended March) net profit rose 2% year on year. Retail gas sales volume remained flat compared with fiscal 2024, falling short of the 2% growth guidance due to a warm winter. However, the dollar margin of CNY 0.54 per cubic meter slightly exceeded target.

China Gas Holdings, or CGH, is involved in the wholesale and retail businesses of natural gas and liquefied petroleum gas, or LPG, in China. The firm benefits from exclusive city gas concession rights and efficient scale. In the past, CGH aggressively expanded into rural city gas projects, resulting in a stretched balance sheet compared with its peers. The firm now focuses on the asset-light value-added services, and integrated energy businesses.

China Gas Holdings, or CGH, is involved in the wholesale and retail businesses of natural gas and liquefied petroleum gas, or LPG, in China. The firm benefits from exclusive city gas concession rights and efficient scale. In the past, CGH aggressively expanded into rural city gas projects, resulting in a stretched balance sheet compared with its peers. The firm now focuses on the asset-light value-added services, and integrated energy businesses.

China Gas Holdings will announce its fiscal 2025 (ended March) results in late June. Meanwhile, the 2024 retail gas sales volume growth of its peers—ENN Energy and China Resources Gas—has fallen below guidance due to a warm winter in China.

China Gas Holdings’ first-half fiscal 2025 (ending March) net profit was down 4% year on year to HKD 1.76 billion. This was attributable to weaker retail gas sales volume, loss-making joint ventures, falling contribution from the LPG segment, a higher tax rate, and increased minority interests.

China Gas Holdings, or CGH, is involved in the wholesale and retail businesses of natural gas and liquefied petroleum gas, or LPG, in China. The firm benefits from exclusive city gas concession rights and efficient scale. In the past, CGH aggressively expanded into rural city gas projects, resulting in a stretched balance sheet compared with its peers. The firm now focuses on the asset-light value-added services, and integrated energy businesses.

China Gas Holdings, or CGH, is involved in the wholesale and retail businesses of natural gas and liquefied petroleum gas, or LPG, in China. The firm benefits from exclusive city gas concession rights and efficient scale. In the past, CGH aggressively expanded into rural city gas projects, resulting in a stretched balance sheet compared with its peers. The firm now focuses on the asset-light value-added services, and integrated energy businesses.

ENN Energy’s cumulative nine-month operating data is in line with our expectations. Retail gas sales volume rose 4.8% year on year, while sales volume of integrated energy grew 21.4%. Dollar margin was CNY 0.54 per cubic meter with new residential connections of 1.1 million.

China Gas Holdings’, or CGH’s, fiscal 2024 (ending March) results were disappointing, falling 26% year on year. Stripping out other losses (mainly impairment losses of HKD 686 million on trade receivables and contract assets), core earnings were still 4% lower. We cut our fiscal 2025-27 earnings estimates by 13%-17% to reflect lower gas and connections income, slower value-added services, or VAS, earnings growth, and a weaker Chinese yuan. Consequently, our fair value estimate is reduced to HKD 11.50 per share from HKD 12.50. Although CGH’s valuation is undemanding, our preferred pick in the sector is ENN Energy as we think investors will need time to regain confidence on CGH given its consistent underperformance in earnings.

China Gas Holdings, or CGH, is involved in the wholesale and retail businesses of natural gas and liquefied petroleum gas, or LPG, in China. The firm benefits from exclusive city gas concession rights and efficient scale. In the past, CGH aggressively expanded into rural city gas projects, resulting in a stretched balance sheet compared with its peers. The firm now focuses on the asset-light value-added services, and integrated energy businesses.

We think the China city gas sector is currently undervalued, but our preferred pick is ENN Energy, given its well-diversified earnings supported by its integrated energy, or IE, segment and value-added business, or VAB. Following the in-line first-quarter operating data from ENN, we keep its fair value estimate at HKD 88 per share. We believe the data supports our view of a gradual recovery for the industry and should be a positive read across for China Gas Holdings, or CGH, and China Resources Gas, or CRG, where we maintain our fair value estimates of HKD 12.50 and HKD 30.00 per share, respectively.

As we saw weaker 2024 new residential connections guidance from both narrow-moat ENN Energy and China Resources Gas, we decided to fine-tune our earnings forecasts for narrow-moat China Gas Holdings, or CGH, to incorporate the latest trend. This leads to CGH’s fiscal (ending March) 2024-26 earnings estimates being lowered by 1%-2%, and our fair value estimate is slightly reduced to HKD 12.50 per share from HKD 12.60.

China Gas Holdings, or CGH, is involved in the wholesale and retail businesses of natural gas and liquefied petroleum gas, or LPG, in China. Benefiting from its exclusive city gas concession rights and efficient scale, the firm has been able to generate returns above its cost of capital, and we expect this to continue over the next decade, supporting our narrow moat rating for CGH. In the past, CGH aggressively expanded into rural city gas projects, resulting in a relatively stretched balance sheet compared with its peers. The firm now focuses on the asset-light value-added services business, as well as development of the urban heating business.