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China Resources Power Holdings Co Ltd 00836

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Stock XHKG Rating as of
HKD 19.64 −0.18 (0.91%)
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As of Delayed Price Closed
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Company Report

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China Resources Power Earnings: Thermal Segment Recovery on Track; Shares Undervalued

Chokwai Lee

China Resources Power’s, or CR Power’s, 2023 net profit of HKD 11.0 billion trails our estimate, mainly due to asset impairment losses of HKD 2.7 billion, but key generation numbers were in line with our expectations. We cut our fair value estimate to HKD 23 per share from HKD 25 to factor in lower renewable tariffs and higher near-term capital expenditure, or capex. Nonetheless, we think CR Power is undervalued, with continued improvement in the thermal power segment’s profitability and an estimated 2024 yield of more than 5%.

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Price vs Fair Value

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00836 is trading at a 14% discount.
Price
HKD 19.76
Fair Value
HKD 32.00
Uncertainty
High
1-Star Price
HKD 63.55
5-Star Price
HKD 34.50
Economic Moat
Kbt
Capital Allocation
Wwfsxqf

Bulls Say, Bears Say

Bulls

China’s base-price-plus-floating mechanism for coal-fired power generation and increasing proportion of medium- and long-term thermal coal supply contracts would lead to a more stable earnings outlook for coal-fired power producers.

Bears

China's decarbonization goals would continue to raise renewable energy capacity and gradually decrease demand for coal-fired power generation, negatively affecting China Resources Power’s thermal power segment.

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Trading Information

Previous Close Price
HKD 19.82
Day Range
HKD 19.34–20.00
52-Week Range
HKD 14.00–20.35
Bid/Ask
HKD 19.64 / HKD 19.66
Market Cap
HKD 94.48 Bil
Volume/Avg
20.1 Mil / 14.5 Mil

Key Statistics

Price/Earnings (Normalized)
8.07
Price/Sales
0.91
Dividend Yield (Trailing)
3.55%
Dividend Yield (Forward)
5.92%
Total Yield
3.58%

Company Profile

China Resources Power, or CR Power, is one of China’s largest independent power producers. The firm operates wind farms, photovoltaic power plants, hydroelectric power plants and thermal power (coal-fired and gas-fired) plants, which are situated mostly in eastern, central and southern China, with a total attributable operational generation capacity of about 59.8 gigawatts as of end-2023. Renewable energy accounts for about 37.8% of its capacity. China Resources Holdings, a key state-owned conglomerate, owns approximately 62.9% of CR Power’s shares outstanding.
Sector
Utilities
Industry
Utilities - Independent Power Producers
Stock Style Box
Large Value
Total Number of Employees
22,203
Website
https://www.cr-power.com

Competitors

Valuation

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Metric
00836
01816
01798
Price/Earnings (Normalized)
 8.0711.373.78
Price/Book Value
 1.111.070.61
Price/Sales
 0.911.460.85
Price/Cash Flow
 3.493.541.29
Price/Earnings
00836
01816
01798

Financial Strength

Metric
00836
01816
01798
Quick Ratio
 0.510.431.59
Current Ratio
 0.590.941.74
Interest Coverage
 4.694.743.56
Quick Ratio
00836
01816
01798

Profitability

Metric
00836
01816
01798
Return on Assets (Normalized)
 4.37%2.57%3.68%
Return on Equity (Normalized)
 16.01%9.64%21.48%
Return on Invested Capital (Normalized)
 6.39%4.04%5.85%
Return on Assets
00836
01816
01798
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