China Nuclear Power (601985): The leader of the nuclear power industry is poised to fly in the wind

The leader in the nuclear power industry has for the first time covered the company with a “buy” rating. The installed capacity of nuclear power accounts for half of the domestic nuclear power. As of the end of June 2019, the company has a total of 21 units in commercial operation, with a total installed capacity of 19.09 million kilowatts.No. 5/6 and Tianwan Nuclear Power No. 5/6 were put into operation successively, and the operating cash flow will gradually improve.

What do we expect the company 2019?

21 years is expected to achieve net profit return to mother49.

0/52.

9/57.

500 million.

Combining the comprehensive calculation results of the DCF estimation method and the PE estimation method, the company is given a target price of 6.

14-7.

08 yuan / share, “Buy” rating.

The installed capacity occupies half of the country, and the acceleration of distribution shows confidence. As of mid-2019, the company has a total of 21 units to distribute commercial transportation, holding a total installed capacity of 19.09 million kilowatts, accounting for 42% of the country.

At present, nuclear power plants under construction are expected to be put into operation one after another in 2020-24, which will add 6.39 million kilowatts of installed capacity.

In the past three years, the company’s ROE has been stable at more than 10%, and the dividend ratio is between 37% and 40%. In December 2018, it launched an equity incentive distribution. It will take effect in 3 batches in 2021-23, reflecting the ROE of the previous fiscal year. Not less than 9.

5% / 9.

8% / 10.

4%, meanwhile, the average revenue of three years and three years is not less than 13%, and the exercise price is 5.

21 yuan / share.

In 1H19, the net operating cash inflow was 14.6 billion (+ 36% year-on-year). Through the successive commissioning of the project, we believe that the operating cash flow will gradually improve. If the dividend ratio increases, the investment value will be considerable.

The depreciation policy is cautious, and the potential profitability is considerable. The current design life of the second and third generation nuclear power plants is 40/60 years, and the company’s average depreciation period is 24.

4 years (we calculated based on the 18-year comprehensive depreciation rate). If it is assumed that the company’s comprehensive depreciation rate is consistent with CGNPC, the company’s operating costs for 16-18 will fall by 16%.

2/13.

4/25.

500 million, driving a 16-18 year net profit growth of 14.

2/11.

4/21.

800 million, 18% thick / 14% / 25% thicker.

In addition, in the mid-to-late period of nuclear power operations, depreciation of fixed assets is completed, operating costs are significantly reduced, and nuclear power profitability will become more prominent.

The comprehensive advantages of nuclear power are outstanding. With the restart of three generations of nuclear power, the industry has ushered in a period of rapid development. The advantages of nuclear power are outstanding: 1) Self-contained: Internal nuclear power system is perfect, technology is autonomous and controllable; 2) Economy: According to datang data science and technology research institute, 18 yearsApproved standardization degree electricity cost 0.

33 yuan / degree, which is only higher than hydropower; 3) Environmental protection: zero probability of equal emission of SO2; 4) Stability: mainly for base load operation, and the utilization time in 18 years reaches 7184.

The national nuclear power utilization level is lower than the world average. According to wind data, global nuclear power installations / total installed capacity in 2018, nuclear power generation / total power generation were 7% / 10%, accounting for only 2% / 4%.

At present, three generations of nuclear power are taking shape. Considering that related approvals were once stagnant, under the dual constraints of 杭州夜网 energy security + energy structure transformation, the speed of nuclear power advancement will increase in the future.

Company estimate: budget target price 6.

14-7.

08 yuan is based on the breakdown of China nuclear power operation data and financial data.

21 years is expected to achieve net profit return to mother49.

0/52.

9/57.

500 million, an increase of 3 each year.

4% / 7.

9% / 8.

8%, corresponding EPS is 0.

31/0.

34/0.

37 yuan.

Combining the comprehensive calculation results of the DCF estimation method and the PE estimation method, we give the company a target price of 6.

14-7.

08 yuan / share, the first coverage given a “buy” rating.

Risk reminder: The project is put into operation less than expected, the electricity price is down and the risk of compensation, and the risk of trade 北京桑拿洗浴 friction.