Morgan Stanley: Raises target price for CHINA LONGYUAN to HKD 8.8, maintains "Overweight" rating

JP Morgan released a research report stating that it has raised the profit forecast for CHINA LONGYUAN for the fiscal years 2025 to 2027, reflecting the wind power trends so far this year and the operational situation in the second quarter. The newly announced target of 3,600 GW for wind and solar capacity by 2035 has improved CHINA LONGYUAN's long-term outlook. The uncertainty regarding electricity price regulation and power rationing may improve as regulators seek to attract capital expenditure. Based on a target price-to-book ratio of 0.85 times (up from 0.75 times), Morgan Stanley raised the target price for CHINA LONGYUAN by 16% to HKD 8.8 and maintained an "Overweight" rating. Morgan Stanley noted that the national announcement set a target of 3,600 GW for wind and solar energy in China by 2035, and CHINA LONGYUAN, as the largest wind farm operator in China, will benefit from capacity growth. There is uncertainty regarding the regulation of electricity prices for wind/solar power plants and the cyclical headwinds of power rationing. However, with the direction of regulators, Morgan Stanley believes these issues will improve to attract capital expenditure for capacity deployment. Combining various operational trends observed in the second quarter of 2025, Morgan Stanley raised the profit forecast for CHINA LONGYUAN for the fiscal years 2025 to 2027 by 5% to 6%