08 Mar 2023

CNE’s FY22 revenue was up by 22.0% YoY to Rmb2,679m, mainly due to a 20.9% YoY increase in power sales, which accounted for 78.9% of total revenue (FY21: 79.6%). Revenue from wind power rose by 13.9% YoY to Rmb1,769m, mainly driven by increase in both capacity (+40.0% YoY to 2,469MW) and utilization hrs (+8.3% YoY to 2,921 hrs), while partly offset by 23.8% decline in tariff to Rmb0.39/kWh as the contribution from lower-tariff grid parity projects increased to 60% (FY21:42%). Revenue from solar was up by 76.4% YoY to Rmb344m as capacity increased from 374MW by end-FY21 to 444MW in FY22. Avg solar utilization hrs was up by 7.9% YoY to 1,532 hrs and curtailment reduced significantly by 6.8ppt to 4.1%. Avg solar tariff was Rmb0.4895/kWh, down from Rmb0.7806/kWh last year. Wind/solar accounted for 84%/16% of FY22 power sales. EPC/O&M was up by 41.8%/14.0% YoY and accounted for 10.7%/10.4% of total revenue. FY22 GPM edged down by 0.5ppt to 59.5% mainly caused by the increase in subsidy-free projects. Besides, admin cost recorded an 26.3% YoY rise mainly due to the rise in number of employees to >2,500 (2021: 1,907) amid increase in projects. Income tax increased by 87% YoY to Rmb228m partly due to some of its projects that have commenced operation for 3-3.5 years are required to pay tax, and thus mgmt. expects the relatively high tax rate will persist in FY23. As a result, NP was up by 10.7% YoY to Rmb872m. The company declared a final DPS of HK0.035 (FY21: HK0.03).

CROSBY Research – Concord New Energy (182 HK/BUY): Bodes well into the grid parity era