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<Research> M Stanley Raises HUANENG POWER (00902.HK) TP to HKD6.1, Rating Equalweight
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M Stanley published a research report, lowering its revenue forecasts for HUANENG POWER (00902.HK) for 2026 to 2027 by 8% to 10% to reflect more conservative power generation assumptions and a downtrend in on-grid tariffs. The broker expects the blended tariff in 2026 to decline by 1%, mainly as lower annual contract prices offset strength in the spot market, while renewable energy tariffs continue to trend lower. It raised the TP for HUANENG POWER H-shares from HKD5.5 to HKD6.1, reflecting the valuation base rolling forward to 2027, while maintaining a target price-to-earnings ratio of 8.5x and reiterating an Equalweight rating. Due to lower-than-expected minority interests in 2025, the broker slightly raised its 2026 net profit forecast by 1.4%, but cut its 2027 net profit forecast by 15.5%. After revisions, revenue is projected to decline by 5% and 2% in 2026 and 2027, respectively, while net profit is expected to fall by 12% and 7% over the same period. The report expects the spread between fuel costs and electricity tariffs (dark spread) to narrow this year, with potentially weak results in the second quarter. However, based on an assumed payout ratio of 53%, the dividend yield is still projected to reach 5.4% in 2026. Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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