Urban Gas Utility Sector Challenges: The urban gas utility sector is experiencing a slowdown in gas sales growth and a decline in new users, although profit margin expansion has mitigated some negative impacts, according to HSBC Research.
Sales and User Projections: HSBC Research anticipates stable retail gas sales in the second half of 2025, but expects a 16% year-over-year decrease in new users for TG SMART ENERGY in 2025, with gas prices likely increasing due to a hike in August 2024.
Broker Ratings and Target Price Adjustments: Daiwa has upgraded the CN gas industry rating to Neutral and HK & CHINA GAS to Outperform, while maintaining a Buy rating on TG SMART ENERGY but lowering its target price from HKD4.7 to HKD4.
Earnings Forecast Revisions: HSBC Research has revised down its earnings forecasts for TG SMART ENERGY by 6-7% and for HK & CHINA GAS by 7-8% due to reduced contributions from the renewable energy sector.
Wall Street analysts forecast 00003 stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for 00003 is USD with a low forecast of USD and a high forecast of USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
0 Analyst Rating
Wall Street analysts forecast 00003 stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for 00003 is USD with a low forecast of USD and a high forecast of USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
0 Buy
0 Hold
0 Sell
Current: 7.160
Low
Averages
High
Current: 7.160
Low
Averages
High
HSBC
HSBC Research
Buy
to
Hold
downgrade
$4
Al Analysis
2026-01-09
Reason
HSBC
HSBC Research
Price Target
$4
Al Analysis
2026-01-09
downgrade
Buy
to
Hold
Reason
The analyst rating for TG SMART ENERGY is maintained as a "Buy" despite a reduction in the target price from HKD 4.7 to HKD 4. This decision is based on the expectation that retail gas sales will remain stable in the second half of 2025, and while the number of new users is projected to decrease by 16% year-over-year in 2025, gas sales in Hong Kong are anticipated to stay solid. Additionally, a gas price hike in August 2024 is expected to support sales volume. However, the earnings forecasts for TG SMART ENERGY have been lowered by 6-7% for 2025-27 due to a reduced contribution from the renewable energy business.
Daiwa
Daiwa
Hold
to
Outperform
upgrade
2026-01-08
Reason
Daiwa
Daiwa
Price Target
2026-01-08
upgrade
Hold
to
Outperform
Reason
The analyst rating for HK & CHINA GAS was upgraded from Hold to Outperform due to an improvement in fundamentals driven by the recovery of earnings in its green fuel business. This positive outlook is supported by the anticipated recovery of sustainable aviation fuel prices and the addition of new capacity, which is expected to lead to a turnaround in the company's performance in the second half of 2025. Additionally, the restructuring and potential spin-off of its subsidiary EcoCeres after 2026 is expected to provide room for increased dividends per share. The target price was also raised from HKD7.1 to HKD7.7.
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Citi
Citi Research
Neutral
maintain
$7
2026-01-08
Reason
Citi
Citi Research
Price Target
$7
2026-01-08
maintain
Neutral
Reason
Citi Research lowered its earnings forecasts for HK & CHINA GAS (00003.HK) for 2025-2027 by 2-5% primarily due to a reduced contribution forecast from its subsidiary, TG SMART ENERGY (01083.HK), and anticipated foreign exchange losses from the appreciation of CNY/HKD. Despite this revision, the broker maintained a target price of $7 and a Neutral rating, as the adjustments to the earnings forecast were relatively mild. Additionally, Citi's 2025 earnings forecast for HK & CHINA GAS is 8% lower than market consensus, with expectations of a 2% year-over-year decline, even when excluding foreign exchange impacts. The broker noted that investors are particularly concerned about the company's dividend, which is expected to remain at $0.35, yielding 5%.
Daiwa
Daiwa
Negative
to
Neutral
upgrade
2026-01-07
Reason
Daiwa
Daiwa
Price Target
2026-01-07
upgrade
Negative
to
Neutral
Reason
The analyst rating was upgraded from Negative to Neutral for the Chinese gas utility sector due to a predicted rebound in natural gas demand this year, influenced by base effects. Despite expectations of a mild winter in China, which may suppress heating demand growth, the report suggests that gas supply will remain sufficient, limiting profit risks for gas companies. Additionally, the upgrade reflects a preference for high-dividend stocks, specifically raising the rating of HK & CHINA GAS from Hold to Outperform and increasing its target price.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
