According to the Zhixin Finance and Economics App, Huadian International (01071) fell nearly 3% again, with a cumulative decline of about 15% this week. As of press time, it has fallen by 2.63%, to HK$4.07, with a turnover of 87.3763 million Hong Kong dollars.
Citigroup released a research report stating that it is expected that Huadian International's net profit in the second quarter will increase by less than 10% compared to the same period last year, far lower than the first quarter growth rate of 77.8% and the market's expected 68.5% year-on-year growth rate, mainly because coal-fired power generation was lower than expected from April to May, with a year-on-year decrease of more than 10% in Hubei, Hunan, Sichuan, Chongqing, and other places being replaced by hydroelectric power. In addition, due to the downward adjustment of grid electricity prices, second-quarter profits are expected to decrease by 4% year-on-year, which is similar to the first quarter. Net profit growth in the second quarter may be lower, including no growth from April to May. The bank expects that the company's first-half profit will be lower than expected.
Guotai Junan previously pointed out that due to the enhanced crowding-out effect of clean energy such as hydroelectric power, the utilization rate of thermal power may decline in the second quarter; in the second quarter, the domestic spot coal prices trended downward and the overall long-term contract coal prices remained stable. Considering the impact of the decline in the utilization rate of thermal power, the increase in power plant coal consumption after the heating season, and the seasonal factors of other businesses, it is expected that the comprehensive profitability of various thermal power companies in the second quarter will differentiate, and the difference in profitability will mainly depend on regional electricity prices, utilization hours, and market coal exposure, etc.