综合上述因素，该行分别降低FY25-26股东净利润预测16.6%及23.3%，并新增FY27预测。考虑到相对上次更新时的市场风险下跌，该行滚动至7.5倍FY26目标市盈率。该行将目标价由6.30港元降低至6.10港元，对应29.1%上升空间。待自来水调价及分红比率落实情况，该行不排除未来调高估值的可能性。维持“买入”评级。Jinwu Financial News | According to the Sino-Thai International Development Research Report, China Water (00855) adjusted its development strategy in response to the announcement in September to suspend the listing plan for the sale of tap water and piped drinking water businesses, shifting from rapidly adding new projects to strengthening existing operations and management to reduce capital expenses. This strategic adjustment will mainly result in a decline in the non-cash flow construction revenue contribution of the two businesses of tap water and drinking water from pipelines. The bank expects the company's construction revenue to fall from 45.5% of FY24 to 42.0%, 41.2%, and 39.8% of FY25-27, respectively.
Meanwhile, the tap water price adjustment process continues. FY24 received price increases for four projects. Two of them were tap water projects in Hanchuan, Hubei and Huaihua, Hunan, with a total production capacity of 0.065 million tons/day.
The bank anticipates a decrease in the company's cash outflow from investment activities during the FY25-27 period. Furthermore, domestic and foreign interest rates are declining, making it easier for companies to obtain favorable additional financing costs. For example, in August, the company issued 0.5 billion yuan of 3-year panda bonds, with a coupon interest rate of 3%. The above factors will give the company more room to increase the dividend ratio in the future.
Combining the above factors, the bank reduced FY25-26 shareholders' net profit forecasts by 16.6% and 23.3%, respectively, and added FY27 forecasts. Taking into account the decline in market risk compared to the time of the last update, the bank rolled to 7.5 times the target price-earnings ratio of FY26. The bank reduced its target price from HK$6.30 to HK$6.10, corresponding to a 29.1% increase. Subject to the implementation of tap water price adjustments and dividend ratios, the bank will not rule out the possibility of raising the valuation in the future. Maintain a “buy” rating.