J.P. Morgan: Maintains "Overweight" rating on China Longyuan Power Group Corporation (00916); third-quarter profit expected to fall about 25% year-on-year.

J.P. Morgan released a research report stating that China Longyuan Power Group Corporation (00916)'s third-quarter profit is expected to fall about 25% year-on-year to approximately RMB 830 million, a slight improvement from the 28% year-on-year decline in the first half, supported by stabilizing wind power generation and continued strong generation from CECEP Solar Energy; the bank maintains an "Overweight" rating on China Longyuan Power Group Corporation with a target price of HK$7. The bank noted that third-quarter wind power generation was roughly flat year-on-year, an improvement from the 7% year-on-year decline in the first half; CECEP Solar Energy's power generation rose 15% year-on-year. Despite the stabilization in generation trends, actual electricity prices remain under pressure due to the implementation of Document 136. The bank believes that the worst of the company's earnings reset may be over, and that actual electricity price pressure is expected to ease after the first full year of power marketization resets in 2026, supporting a gradual recovery in earnings fundamentals in 2027, with operating fundamentals expected to gradually improve over time. The bank maintains its earnings forecasts for Longyuan from 2026 to 2028 unchanged.