Another main theme of AI investment emerges: US hedge funds heavily buy nuclear power stocks as technology giants gather to deploy this technology.
①In Q3, American hedge funds maintained a stable exposure to AI-related investment themes, but reduced their investment in the semiconductor industry for the first time since Q2 2022. ②In OpenAI's latest disclosed "American AI Infrastructure Blueprint," lies its grand nuclear power vision; Huang Renxun also expresses a bullish attitude towards nuclear energy. ③From the trends of tech giants, most of them have chosen small modular reactors (SMR).
Daiwa: Downgrade the rating of the electrical utilities industry to neutral. The ranking is nuclear power/coal power/hydroelectric power.
Grunt on November 21st | Daiwa released a report stating that it downgraded the rating of China power industry from positive to neutral. Specifically, hydropower is overvalued and needs a better entry point; the utilization rate of wind power and the lowering of electricity prices remain issues. Daiwa explained that the electrical utilities sector outperformed the overall market in the first three quarters, benefiting from the defensive nature of these stocks under the ongoing "risk-off" sentiment. However, the bank noted that since October, investors have noticeably shifted towards risk preference under the stimulus of China's economic stimulus package. This shift in sentiment has led to funds flowing out of electric power stocks into other industries, with the bank believing this situation will continue until 2025.
Daiwa: Next year, the industry favors nuclear power the most. The target price for cgn power (01816) is raised to 2.9 Hong Kong dollars.
Looking ahead to next year, the rankings are nuclear power/coal power/hydro power, with wind power coming last.
Daiwa's investment rating and target price for electric power stocks in mainland China (table).
Daiwa has released a research report, listing the investment ratings and target prices for mainland electric power H shares as follows: Stock | Investment Rating | Target Price (HKD) cgn power (01816.HK) | hold | 2.1 -> 2.9 yuan datang renew (01798.HK) | underperform | 1.8 yuan china longyuan (00916.HK) | underperform | 6.1 yuan china power international (02380.HK) | buy | 4.3 yuan china res power (00836.HK) | underperform -> hold.
Daiwa upgraded the rating of Enhance Power (00836.HK) to "hold" and raised the target price of CGN Power (01816.HK).
Daiwa issued a report stating that it believes the china power industry lacks actionable ideas, and therefore has downgraded the industry rating from "positive" to "neutral". Among them, the valuation of hydroelectric power is relatively high, requiring better market entry opportunities; the utilization rate and price reduction of wind power remain issues. Daiwa explained that the electrical utilities sector has outperformed the overall market in the first three quarters, benefiting from the defensive nature of these stocks amid ongoing "de-risking" sentiment. However, the firm noted that since October, driven by China's economic stimulus plans, investors have clearly shifted towards a preference for risk. This outlook shift has led to capital outflow from electric power stocks to other industries, and the firm believes this situation...
Morgan Stanley: Maintains the "shareholding" rating for cgn power, target price raised to HKD 3.69.
Da Ma believes that cgn power's roe still has potential for growth.