Since April, TIAN LUN GAS (01600) has shown a trend of rising stock prices, leading the gas industry sector strongly. At the same time, during the same period, the gas stock index also reached a maximum increase of 17.33%. The entire gas sector has shown a considerable profit effect in the first half of the year, and it is expected that the gas sector will continue its upward trend in the second half of the year.
The impressive stock price performance is directly related to TIAN LUN GAS's stable and improving fundamentals, which is evident in its latest performance.
On August 28, TIAN LUN GAS released its interim performance announcement for the first half of 2025. The data shows that the company's revenue during the reporting period was 4.242 billion yuan (RMB, the same below), a year-on-year increase of 10.6%.
At the same time, the board of directors of TIAN LUN GAS announced the distribution of an interim dividend of 4.6 cents per share, corresponding to a core profit payout ratio as high as 35%, demonstrating the company's firm commitment to continuously return to investors.
As a fundamentally sound high-dividend asset, it is reasonable that TIAN LUN GAS has attracted market funds. With the company's steady growth in future performance and the accelerated allocation of funds to high-dividend assets, TIAN LUN GAS's stock price is expected to rise to higher levels.
<h2>Gas Sales Business Steadily Plays the Role of &#34;Ballast Stone,&#34; Rapid Growth of Value-Added Services Becomes a Highlight</h2>
From a macro industrial perspective, the natural gas industry in the first half of 2025 still faces both opportunities and challenges. Opportunities are reflected in continuous favorable policies; the country is not only increasing efforts in the aging update and renovation of urban gas pipelines but will also invest a total of 800 billion yuan throughout the year for the renovation of underground pipelines for gas, water supply, etc. Additionally, policies have accelerated the promotion of natural gas price marketization reform, actively advancing the digitalization and intelligent construction of gas, and incorporating the entire supply, sales, storage, and transportation chain of natural gas into smart supervision, thereby accelerating the development process of smart gas.
However, challenges are also quite evident. From the perspective of production and sales, the natural gas industry during the reporting period exhibited characteristics of &#34;loose supply and slowing demand.&#34; Data shows that the natural gas supply in the first half of 2025 reached 211.6 billion cubic meters. After deducting losses and the reduction in light hydrocarbon recovery, the market supply was 205.8 billion cubic meters, with a resource surplus of 1.7 billion cubic meters, leading LNG receiving stations to actively carry out destocking operations.
The sluggish demand side has put pressure on the market. According to data from the National Development and Reform Commission, the apparent consumption of natural gas in China in the first half of 2025 was 211.97 billion cubic meters, a year-on-year decrease of 0.9%, with the growth rate falling by 4.7 percentage points compared to the same period in 2024. This is mainly attributed to the warm winter effect and weakened industrial demand due to Sino-U.S. tariff policies.
It can be seen that the development of the natural gas industry in the first half of 2025 is not easy, but TIAN LUN GAS still achieved sustained and stable growth in its business. Specifically, the total revenue of TIAN LUN GAS increased by 10.6% to 4.242 billion yuan during the reporting period, mainly driven by the dual engines of gas sales and value-added services, both of which achieved rapid growth.
The gas sales business of TIAN LUN GAS mainly includes two major segments: retail and wholesale. The revenue from gas sales during the reporting period increased by 12.8% to 3.64 billion yuan, primarily due to a 15.3% increase in total gas sales volume to 1.268 billion cubic meters, which drove the growth of gas sales revenue
Among them, in terms of retail gas volume, TIAN LUN GAS deepened the supply guarantee and energy service for industrial and commercial users, stabilized core customer demand, and tapped into the existing market. Through policies such as &#34;oil-to-gas&#34; and &#34;bottle-to-pipe,&#34; it expanded new users. During the reporting period, the cumulative number of pipeline gas users increased by 3.6% to 5.9333 million, with urban gas residential users growing by 5.4% and industrial and commercial users increasing by 9.1%. The continuous growth in the number of users kept the retail gas sales volume stable at 880 million cubic meters, resulting in retail business revenue remaining flat year-on-year.
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In terms of wholesale gas volume, to respond to peak demand during the heating season and ensure stable gas supply, TIAN LUN GAS accurately assessed user demand and accelerated market development during the reporting period. The company vigorously promoted its energy trading business, leading to wholesale gas sales volume reaching 388 million cubic meters, a year-on-year increase of 74.7%, becoming the main driving force for the growth of gas sales revenue.
It is worth noting that during the reporting period, TIAN LUN GAS achieved new results in gas source optimization. The company expanded multi-source gas supply and constructed a multi-source supply pattern, as well as achieved intelligent operation of the pipeline network through technological upgrades, effectively reducing gas transmission losses and promoting interconnection of gas networks. This allowed TIAN LUN GAS to report a 1 cent increase in the comprehensive gas sales price difference during the reporting period, thus maintaining robust retail gas sales profits, continuing to play a key role as a &#34;ballast stone&#34; for performance.
As a new growth driver for TIAN LUN GAS, value-added services achieved rapid growth during the reporting period. In the first half of the year, TIAN LUN GAS actively explored new business areas for value-added services by building a specialized marketing system for value-added services, deeply integrating gas safety and personalized decoration services, and actively utilizing scenarios for old and outdated renovations. This promoted a dual increase in the average insurance premium per household and user coverage rate through diversified service methods, significantly enhancing user stickiness and conversion rates, thus opening up a new path for sustainable development.
During the reporting period, TIAN LUN GAS's value-added service revenue reached 231 million yuan, a year-on-year increase of 27.6%, accounting for 5.4% of the company's total revenue. Among them, decoration service revenue grew by 44% to 190 million yuan, showing very strong growth momentum, indicating that TIAN LUN GAS has fully seized the market opportunity for old and outdated renovations through its decoration services. This also indirectly shows that TIAN LUN GAS's development strategy of creating a new growth curve through value-added services has begun to accelerate in showing results.
<h2>Supply and demand pattern in the second half of the year is expected to improve, operating environment to become better</h2>
Despite the challenging industry environment in the first half of the year, TIAN LUN GAS still achieved stable and positive results. In the second half of the year, it is expected to achieve accelerated growth, as the supply and demand pattern in the natural gas industry is expected to further improve, and the pricing mechanism is likely to be accelerated.
From the demand side, under the joint action of multiple factors, the growth rate of apparent natural gas consumption in the second half of the year is expected to regain growth, with downstream demand likely to show significant recovery compared to the first half of the year.
Firstly, 2025, as the concluding year of the &#34;14th Five-Year Plan,&#34; is undoubtedly critical, and the government has ample motivation to ensure stable economic development in the second half of the year; moreover, the Federal Reserve is highly likely to start cutting interest rates in September, which will provide further space for stimulating economic development domestically, thereby driving the recovery of industrial production and increasing the demand for natural gas in the industrial sector
Secondly, as we enter the second half of the year, the impact of tariff policies is gradually weakening. The coastal industrial gas affected by tariffs in the first half of the year is also expected to see a marginal recovery, which is likely to boost demand.
In addition, the growth in electricity demand during the peak summer season will drive an increase in the utilization hours of gas-fired units. In July, China's electricity load and consumption both reached historical peaks, with the load breaking records four times within the month, and entering August with high load operations. This will directly increase the demand for peak-shaving power sources. As a high-quality peak-shaving energy, the recovery in the utilization hours of gas-fired units will inevitably increase natural gas consumption.
On the supply side, thanks to the continued weakening of tariff policy impacts, international natural gas trade may improve, and domestic LNG imports may see a phased increase, which is expected to drive a rebound in the total natural gas imports in the second half of the year. At the same time, domestic natural gas production is likely to continue the steady growth seen in the first half of the year, keeping the supply side in a relaxed state.
With significant improvements on both the supply and demand sides, the pricing mechanism in the natural gas industry is expected to accelerate, leading to further recovery of gas companies' gross margins. From a policy perspective, the &#34;Guiding Opinions on the Pricing Mechanism for Pipeline Transportation within the Province&#34; was released in August 2025. This opinion reduces intermediate markup links and lowers terminal costs (expected reduction of 0.05–0.12 yuan/cubic meter), creating space for pricing mechanisms. As international gas prices decline and domestic production increases, the cost pressure on urban gas companies will be alleviated. Moreover, the current focus on &#34;anti-involution&#34; and breaking deflation has become a core policy concern, providing a favorable environment for the accelerated advancement of the pricing mechanism.
It is understood that many regions have accelerated the establishment of dynamic linkage between terminal sales prices and procurement costs, with non-residential gas adjusted monthly and residential gas adjusted up to once a year. This reflects the acceleration of the pricing mechanism, which is more beneficial for gas companies with significant advantages in the industrial and commercial sectors.
<h2>Location Advantage Highlights, Business for Industrial and Commercial Users Expected to Achieve Resilient Growth</h2>
In the process of accelerating the pricing mechanism in the gas industry, Tian Lun Gas has a unique customer structure and location advantage compared to other gas companies. From the customer structure perspective, in mid-2024, the gas sales of Tian Lun Gas to residential users, industrial and commercial users, transportation users, and wholesale business accounted for 24.1%, 42.8%, 2.5%, and 30.6% of total gas sales, respectively. This shows that the industrial and commercial market is a strong area for Tian Lun Gas, making it easier to benefit from the accelerated advancement of the pricing mechanism.
From the location dimension, the urban gas and industrial and commercial user projects of Tian Lun Gas are mainly located in inland areas such as Henan, Jilin, Yunnan, Shandong, and Gansu. The industrial and commercial users are demand-driven, thus
compared to coastal export-oriented industries, Tian Lun Gas's industrial and commercial users are less affected by international trade frictions. This means that, under the current complex and changing international situation, Tian Lun Gas's location advantage will make its business operations more stable compared to other gas companies.
Moreover, Tian Lun Gas's location advantage will benefit from the transfer of industries from the eastern region to the central and western regions. From 2018 to 2023, the number of production bases transferred from the east to the central and western regions reached 137, far exceeding the 84 in overseas markets, allowing Tian Lun Gas to benefit from this. Additionally, the central and western regions have abundant gas sources, which will help Tian Lun Gas better improve its gross margin
Previously, Guozheng International released a research report stating that TIAN LUN GAS's commercial and industrial customers have location advantages. In the future, with the trend of the central and western regions undertaking industrial transfers from the eastern regions, the company has significant growth potential in gas sales in Gansu's Baiyin and Jingyuan. Additionally, the ample gas supply in Gansu is beneficial for the company's gross margin pricing in Baiyin and Jingyuan. The Gansu company is expected to become a major growth pole for the company's gas sales business.
Based on the company's advantages in customer structure and location, as well as the significant improvement in the industry situation in the second half of the year, TIAN LUN GAS has made detailed plans for its business layout in the second half of the year in its financial report to ensure the high-quality completion of its development goals, aiming to conclude the 14th Five-Year Plan in 2025 successfully.
It is foreseeable that as TIAN LUN GAS continues to solidify its urban gas business foundation and innovate diversified value-added service scenarios, the company's fundamentals will further optimize. It is expected to achieve further growth in the second half of the year, combined with the company's consistently high dividend payout style, TIAN LUN GAS has become a high-dividend asset with stable and improving fundamentals

01600

TIAN LUN GAS achieved revenue of 4.242 billion yuan in the first half of 2025, a year-on-year increase of 10.6%. The company announced an interim dividend of 4.6 cents per share, with a payout ratio as high as 35%. The stock price has continued to rise since April and is expected to keep climbing, benefiting from solid fundamentals and high dividends attracting market funds. The natural gas industry faces both opportunities and challenges, with policy support and market-oriented reforms accelerating development, but attention must also be paid to the phenomenon of relaxed supply and slowing demand

Zhitong

TIAN LUN GAS

Dual-driven, TIAN LUN GAS achieves dual-line growth in gas sales and value-added services, with a high certainty dividend commitment leading to a value reassessment