Citi's Research Report: Citi has added HUANENG POWER (00902.HK) to its 30-day downside catalyst watchlist due to anticipated declines in market base electricity prices for 2026, which are expected to fall below market expectations.

Electricity Sales and Tariffs: The report indicates that 63.5% of HUANENG POWER's electricity sales in 1-3Q25 are from Guangdong, Zhejiang, and Jiangsu, where the average market base tariff is projected to decrease by 13.4% YoY in 2026.

Coal Power Capacity Growth: China's coal power plants are expected to see a 65% YoY increase in electricity production capacity, leading to an estimated 8.9% YoY drop in HUANENG POWER's average coal electricity tariff in 2026.

Target Price and Rating: HUANENG POWER has been assigned a target price of HKD7.2 and a Buy rating by Citi, despite the challenges posed by declining tariffs and increased production capacity.

Electricity Tariffs and Project Insights: By the end of 2025, electricity tariffs bidding results for 25 provinces in China were released, indicating that high-quality regional projects remain profitable despite a smaller release scale, with current policies favoring wind power growth.

Focus on Industry Leaders: CICC recommends focusing on industry leaders with significant wind power portfolios and strong operational capabilities, as they are likely to benefit from the supportive policies.

Project Distribution Statistics: The five major power centralized photovoltaic and wind power projects accounted for 19% and 22% of incremental projects, respectively, with HUANENG POWER, State Power Investment Corporation, and DATANG RENEW leading in resource acquisition.

Impact of Development Strategies: The development focus may shift towards new energy large bases, while the ranking of new installations for conventional projects could be affected by the "15th Five-Year Plan" and the release of resources in advantageous regions.

Top Net Buys: The top 10 Hong Kong stocks with the highest net buys by southbound funds include XIAOMI-W, CNOOC, and MEITUAN-W, with significant short selling ratios and varying net inflow amounts.

Top Net Sells: The top 10 Hong Kong stocks with the highest net sells by southbound funds feature SMIC, TENCENT, and HUA HONG SEMI, showing substantial short selling activity and notable net outflow amounts.

Operating Revenue and Profit: Huaneng Power reported a 7.1% year-over-year decline in 3Q25 operating revenue at RMB60.94 billion, but net profit attributable to the parent company surged 89% YoY to RMB5.58 billion, exceeding expectations.

Year-to-Date Performance: For the first nine months of 2025, the net profit attributable to the parent company reached a record high of RMB14.84 billion, reflecting a 43% increase compared to the previous year.

Analyst Ratings and Target Prices: CICC maintained an "Outperform" rating for Huaneng Power, keeping the target price for its A-shares at RMB10.49 and increasing the target price for H-shares by 20% to $8.03.

Short Selling Data: As of October 31, 2025, Huaneng Power experienced short selling of $24.85 million, with a short selling ratio of 10.538%.

Market Performance: Hong Kong equities showed muted fluctuations on the settlement date, with the HSI closing down 0.2% at 26,282 and total market turnover increasing to $353.804 billion.

Stock Highlights: Standard Chartered surged 4.2% on strong quarterly results, while BOC Hong Kong fell 0.8% despite a profit increase. Other notable movements included HSBC gaining 1.4% and AIA declining 1.9%.

Commodities Sector: Stocks in the commodities sector saw significant gains, with Chinagoldintl rising 5.3% and Zijin Mining increasing by 4.6%, alongside other mining companies experiencing similar upward trends.

Energy and Utilities: Energy stocks also performed well, with Xinte Energy up 6.7% and Huaneng Power rising 8%, driven by positive management outlooks on future electricity price hikes.