Lyon: Maintaining the Changhe (00001) “Highly Confident in Outperforming the Market” Rating Target Price of HK$102

The Zhitong Finance App learned that Lyon released a research report saying that Changhe (00001)'s current stock price has a 52% discount compared to its net asset value (NAV) of 142 yuan per share, which is far higher than the long-term average discount of 25%. The bank maintained Changhe's target price of HK$102 (same below) and reiterated its “Highly Confident Outperforming Market” rating. It remains one of the bank's two preferred stocks in the Hong Kong integrated enterprise sector.

Lyon said that Changhe's results for the first half of 2026 will be supported by Cenovus Energy's strong performance, same-store sales growth in European and Asian retail businesses, and organic growth in the port business. Furthermore, the euro and British pound appreciated by an average of 7% and 4%, respectively, against the US dollar in the first half of the year, which also contributed to a smooth exchange rate. Although the bank did not forecast semi-annual profit, it is expected that the company's annual recurring profit will increase 21% year over year to 26.2 billion yuan.

The bank indicated that as the sale of UK Rails (UK Rails) and UK Power Networks (UK Power Networks) is completed in the first half of the year, Changhe will confirm disposal proceeds in the first half of the year. According to the company's announcement, the sale of the UK grid will bring about 14.5 billion yuan in disposal proceeds. Investors will continue to pay attention to the company's capital allocation strategy, particularly dividend and asset divestment plans.