China Shenhua (601088): Coal & Electricity Integration Long Continues High Percentage and High Dividend

China Shenhua (601088): Coal & Electricity Integration Long Continues High Percentage and High Dividend

Key points of investment: The company announced its 2018 annual report and realized operating income of 2641.

10,000 yuan, an increase of 6 in ten years.

2%; net profit 438.

67 ppm, 10-year average2.

6%; basic 杭州桑拿 income 2.

21 yuan.

Dividend plan: 10 out of 8.

8 yuan.

Ping An view: coal production, price stability: commercial coal output reached 2.

96.6 billion tons, an increase of 0 in ten years.

At 4%, Shendong Mining Area and Shenbao Mining Area maintained stable and increased production.

In terms of price, the average sales price is 429 yuan / ton (excluding tax), which increases by 0 every year.


The coal long-term association ratio reached 82%.

In 19th’s Boris Hiller, the Harwusu coal mine will return to normal, and the Nortel Shengli open-pit mine will increase its production capacity by 800 pieces.

Electricity installed capacity, utilization hours increased significantly: preliminary completion of electricity generation 2853.

200 million kWh, an increase of 8 in ten years.

5%; 2675 total electricity sales completed.

900 million kWh, an increase of 8 in ten years.


The total installed capacity reached 6,184.

90,000 kilowatts, an increase of 6 in ten years.

9%, of which the total installed capacity of coal-fired generating units is 5,999.

40,000 kilowatts.

The average utilization hours of coal-fired generating units is 4,877 hours, which was 516 hours higher than the national average.

Capacity and capacity have steadily increased: the turnover of its own railway transportation reached 283.9 billion ton-kilometres, surpassing growth by 4%.

0%; sales of coal in the port reached 2.

700 million tons, an annual increase of 4.

6%; expected freight volume1.

4.0 billion tons, an annual increase of 11.


From the perspective of operating income, railway, port and operating business revenues increased respectively.

2%, 7.

1% and 25.


According to the report baseline, the Hebei section of the newly-built Huangda Railway has been determined, and a special line for the Zhugata Coal Consolidation Station (capacity of 1,000 tons / year) of the Shenshuo Railway was opened.

The company’s radiating capacity for rail transportation has been further improved.

The amount of coal chemical industry has stabilized and the price has risen: the company has gradually expanded its sales 61.13 products are released for the first time, which decreases by 3 every year.


The price is affected by oil prices. Polypropylene has increased by 14% in ten years, and polyethylene has increased by 0%.


The cost of raw materials remained stable with a gross profit margin of 24.

9%, an increase of 4 over the previous year.

3 units.

Dividend payout ratio 39.

9%, dividend yield 4.

16%: The company intends to pay 0.

88 yuan / share (including tax), a total of 175.

30,000 yuan (including tax), accounting for 39% of net profit attributable to the mother.

9%, pre-estimated on March 23, divided by expenditure 4.


Investment suggestion: The task of reducing coal production capacity is basically completed, and the integration of coal and electricity + the long-term association is conducive to maintaining stable performance.

In 19 years, coal production capacity was restored, the increase in installed power capacity, the transportation sector continued to grow, and the chemical business remained stable.

Considering that the coal price will return to the green range, the future coal price may be slightly lower than 18 years, and the company’s EPS is expected to be 2 in 2019-2021.

32 yuan, 2.

38 yuan, 2.

44 yuan (previous forecast was 2 for 2019-2020).

47 yuan, 2.

52 yuan), the corresponding PE is 9 respectively.

1, 8.

9, 8.

7 times, maintain the company’s “recommended” rating.

Risk reminders: 1. The rapid development of new energy sources and the decline in economic growth affect the demand for coal and electricity; 2. The state may increase nuclear production, and if the increase is too high, it may cause supply to exceed demand, and the decline in coal prices will affect the company’s performance; 3. Inner Mongolia environmental protection inspection impacts on large open-pit mines such as Baorixile Open-pit Mine and Harwusu, resulting in a decline in self-produced coal production and a decline in operating income of the coal sector business, which has a certain impact on the company’s performance; 4. Inner Mongolia, Shaanxi, etc.Occurrence of safety accidents in the area, frequent safety inspections may affect the company’s production.