CTGR GROUP(600905)：GREEN POWER GIANT FORGES AHEAD

　　China Three Gorges Renewables (CTGR) is one of the pioneers among new energy power operators. The Company is a subsidiary of CTG, whose actively develops wind and solar power. CTGR plans to achieve a newly installed capacity of 5,000 MW in solar and wind power in 2023, with installation progress expected to accelerate in 2H23. We anticipate that lower upstream costs may improve CTGR’s IRR of the new energy projects. CTGR is also exploring the integration of multiple new energy to develop innovative projects and looking for further growth space. Currently, CTGR is trading at 17x FY23E PE. We assign CTGR with FY23E target PE of 20x and arrive at the target price of RMB 6.79/ share.Initiate with BUY.
　　CTGR is one of the top players among new energy power operators.CTGR is a subsidiary of CTG that focuses on developing new energy with great financial resilience and advanced technology, including wind power and solar power, and other new energy such as pumped storage, and hydrogen energy. CTGR aims to achieve newly-added installed capacity of 5,000 MW for solar and wind power in 2023. Even though the installation progress was slightly slower in 1H23, we expect its installation progress will speed up in 2H23 to reach its installation target in 2023.
　　CTGR has strong reserve projects that supports its rapid growth in new energy installation. Lower upstream costs of wind and solar power have led to higher IRR of the company's projects. By 2022, CTGR’s project reserve exceeds 130mn kW. The newly-added identified project achieve 54.88mn kW, including 9.85mn kW of onshore wind power and 25.93mn kW of solar power. We believe abundant projects reserve will send great support for the further growth of CTGR’s installed capacity. Additionally, based on mgmt.’s guided stable tariff assumption, CTGR’s installation willingness will up in 2023 as the IRR of wind and solar power projects may up as the falling upstream cost.
　　CTGR has several competitive advantages in the comparison of the new energy power operators under the "Big Five and Small Noble 4" Power Group. CTGR outperforms in revenue growth, net profit margin, solar power installed capacity, etc. We believe CTGR's new energy installed capacity and power generation will continue to perform well in 2023, due to upstream cost reduction and IRR increase trends, as well as the company's advanced cost control ability. As a result, we expect the company's revenue and net profit to maintain a strong growth momentum in 2023.
　　We assign CTGR with FY23E target PE of 20x and arrive at the target price of RMB 6.79/ share, initiate with BUY. We expect CTGR’s net profit to be RMB9.7bn, RMB11.79bn, and RMB14.44bn in 2023, 2024, and 2025, respectively, with EPS of RMB0.34, RMB0.41, and RMB0.50/share.Additionally, We estimate CTGR will achieve its installed capacity target of 5000MW for solar and wind power in 2023, based on the Company's cost control capabilities and rising IRR of the projects, and stable realized tariff for 2023. Currently, CTGR is trading at 17x FY23E PE. We assign CTGR with an FY23 target PE of 20x and arrive at the target price of RMB 6.79/ share.Initiate with BUY.
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   【免责声明】本文仅代表第三方观点，不代表和讯网立场。投资者据此操作，风险请自担。