[ET Net News Agency, 16 March 2018] HSBC Global Research lifted its target price for
Huaneng Power International (HNP)(00902) to HK$6.2 from HK$5, and upgraded its rating to
"buy" from "hold" on better earnings.
HNP expects "Direct Power Sales" to expand to a 40% mix in 2018, the research house
expects the revenue impact to be limited as these discounts narrow further.
HNP pledged to maintain a >70% pay-out ratio, with DPS of no less than RMB0.1 for
2018-20, as long as profit and retained earnings are positive - HSBC views this was a
pleasant surprise.
It added that the stock is attractive at 0.7x 2018 PB (historical: 0.6-1.7x) over 8% ROE
for 2019. (KL)