7 consecutive limit-up days! 600396, another reminder!

As the “brightest star” in the green power sector, Huadian Liaoning (600396) continued its strong momentum on March 24, closing again with a limit-up, hitting seven consecutive daily gains, and closing at 7.58 yuan per share, with a market value of 11.2 billion yuan.

From March 11 to March 24, Huadian Liaoning’s stock price increased by a total of 95.36% over 10 trading days.

On the evening of March 24, Huadian Liaoning issued another announcement regarding unusual stock price movements, stating that the company’s stock price had risen sharply in the short term, deviating significantly from market trends and fundamentally detached from the company’s actual performance, posing a risk of substantial short-term decline. Investors face extremely high risks.

After verification, Huadian Liaoning’s production and operation activities are currently normal. The company’s main business is thermal power generation, with thermal power installed capacity accounting for 82.56%. The current market environment and industry policies have not undergone major changes, and daily operations remain stable.

In terms of secondary market trading, recent capital battles have intensified, with turnover rates remaining high. On March 20, 23, and 24, the daily turnover rates were 26.74%, 11.43%, and 16.07%, respectively.

It is worth noting that this round of market rally may be mainly driven by small and medium investors. Data from the Shanghai Stock Exchange shows that from March 16 to March 24, individual investors bought and sold a total of 6.72 billion yuan and 6.89 billion yuan, accounting for 85.65% and 87.83% of the total trading volume, respectively. Among them, small and medium investors bought and sold 4.35 billion yuan and 4.49 billion yuan, representing 55.43% and 57.23%.

As the stock price rises, Huadian Liaoning’s price-to-earnings ratio (P/E) and price-to-book ratio (P/B) have also surged. Data shows that the latest rolling P/E ratio and P/B ratio for the power and heat production and supply industry are 17.96 times and 1.58 times, respectively. However, Huadian Liaoning’s latest rolling P/E ratio has reached 174.89 times, and the P/B ratio is 8.26 times, significantly higher than industry averages.

Huadian Liaoning is a subsidiary of China Huadian Corporation. Its main business is power and heat production and sales. Currently, thermal power is its primary revenue source, with renewable energy projects gradually contributing additional growth. As of the end of June 2025, the company had a controlled installed capacity of 2.7375 GW, including 2.26 GW of thermal power and 0.4775 GW of renewable energy, serving 44.3 million square meters of heating area.

In terms of performance, Huadian Liaoning expects net profit for 2025 to be between 25 million and 35 million yuan, a year-on-year decline of 59.17% to 70.84%. After deducting non-recurring gains and losses, net profit is projected to be between 14 million and 19 million yuan, down 54.90% to 67.79% year-on-year.

Huadian Liaoning explained that the decline in performance is mainly due to the issuance of REITs in December 2024, which caused the four wholly owned target companies—Inner Mongolia Huadian Jinyuan New Energy Co., Ltd., Fuxin New Electric New Energy Power Generation Co., Ltd., Zhangwu Huadian New Energy Power Generation Co., Ltd., and Kangping Huadian Wind Power Co., Ltd.—to reduce their shareholding from 100% to 20.02%. In 2025, 79.98% of the income from these four companies will be recognized as minority interest. Excluding the impact of the REIT issuance, the company’s net profit in 2025 is expected to increase by 103 million to 113 million yuan compared to the previous year.

It is also noteworthy that Huadian Liaoning’s third-largest shareholder, Liaoning Energy Investment (Group) Co., Ltd., recently announced a plan to reduce its holdings. The plan is to sell no more than 14.7271 million shares (1% of total shares) through centralized bidding from April 9 to July 8, 2026. Currently, Liaoning Energy Investment (Group) Co., Ltd. holds 244 million shares, representing a 16.6% stake in the company.

Proofread: Yang Lilin