CGN Power reported 3Q26 revenue of RMB19.62bn (+16.99% YoY, +29.35% QoQ) and attributable NP of RMB3.50bn (+36.08% YoY, +3.98% QoQ) under China GAAP. Attributable NP exceeded the upper end of the RMB3.00–3.32bn forecast range in our 3Q26 earnings preview, mainly because newly commissioned units contributed more incremental earnings than we expected. In 9M26, revenue reached RMB51.10bn (+3.98% YoY), attributable NP was RMB9.60bn (+12.75% YoY), and recurring NP was RMB9.02bn (+10.31% YoY). Monthly power prices in Guangdong, where the company’s nuclear fleet is concentrated, have remained elevated since May 2026. This has strengthened market confidence in a YoY increase in Guangdong’s 2027 annual long-term contract tariffs. We expect the company’s power tariffs to rise YoY in 2027. We remain positive on its steady growth under the nuclear power tariff mechanism and maintain BUY.
Fewer overhaul days lift existing units’ grid deliveries in 3Q26
Total grid deliveries from nuclear units operated and managed by the company rose 2.65% YoY to 176.75bn kWh in 9M26, mainly reflecting two factors: 1) Huizhou Units 1 and 2 entered commercial operation on 19 April and 3 August 2026, respectively, while Cangnan Unit 1 entered commercial operation on 29 April. Together, these new units added 9.87bn kWh of grid deliveries. 2) An extended maintenance outage at Taishan Unit 2 in 1H26 reduced Taishan Nuclear Power’s grid deliveries by 39.23% YoY to 9.78bn kWh in 9M26. Fewer overhaul days in 3Q26 helped lift grid deliveries from existing units operated and managed by the company by 3.21% YoY to 60.707bn kWh. Higher average utilization hours at existing units contributed to YoY earnings growth.
Marked cost savings; admin expenses drop despite expansion
The company commissioned three nuclear units between April and August 2026 across two new sites, Huizhou and Cangnan. Despite these additions, cost savings and efficiency gains were significant. Administrative expenses fell 12.18% YoY to RMB583mn in 3Q26 and 0.96% YoY to RMB1.80bn in 9M26.
Earnings forecast and valuation
Reflecting stronger-than-expected earnings from newly commissioned units and expected YoY growth in the company’s on-grid tariffs in 2027, we raise our 2026–2028 attributable NP forecasts by 5.14%/6.18%/4.74% to RMB11.19bn/12.72bn/ 14.09bn. We forecast 2027 EPS/BVPS of RMB0.25/2.73. The company has a substantial nuclear capacity pipeline under construction, with progressive commissioning expected to enhance its value. With reference to A-share peers’ average Wind consensus 2027E PE of 20.7x and the H-shares’ five-year historical average PB of 0.94x, we apply 23.0x 2027E PE to the A-shares and 1.5x 2027E PB to the H-shares. Our target prices arrive at RMB5.79/HKD4.78 (previously RMB5.48/HKD4.44, based on 26.0x 2026E PE for the A-shares and 1.5x 2026E PB for the H-shares). Maintain BUY.
Risks: weaker-than-expected power demand, slower-than-expected reactor approvals, slower-than-expected commissioning of the company’s units, lower-than-expected on-grid tariffs.