Citi lowers the target price for CHINA POWER to 2.75 yuan, rating downgraded to "Sell"
Citi published a research report, downgrading the rating of CHINA POWER (02380.HK) from "Buy" to "Sell," and lowering the target price from HKD 3.5 to HKD 2.75. Additionally, the bank has cut the company's net profit forecasts for 2025 to 2027 by 15%, 27%, and 38%, respectively.
The bank believes that due to the impact of electricity price reductions, CHINA POWER's expected earnings for 2026 may decline year-on-year. Although the company is not expected to cut dividends for 2025 to 2026, its expected dividend yield of 5.7% for 2026 seems insufficient to offset the earnings downside risk caused by the downward trend in China's electricity prices
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