Net profit up 75% YoY; 16% below consensus

DPI reported 1H13 net profit of RMB2,019mn, up 75% YoY, 15.7% belowconsensus. DPI's 1H13 net profit accounts for 44.7% and 40.5% of consensusand our full year estimate, respectively. DPI’s 1H13 RoIC of 4.8% is the lowestamong IPPs vs CPID’s 8%, CRP’s 9%, Huadian’s 6.3% and Huaneng’s 8.4%RoIC in 1H13. DPI’s 1H13 debt to capital ratio dropped to 76.7% from 77.7% in1H12, but is higher than the 76.5% in 2012. Its 1H13 average cost of debt alsodropped to 6.2% from 6.8% in 2012 and 6.6% in 1H12.

Duolun coal-chemical project loss of Rmb519mn in 1H13

DTP announced that its Duolun coal-chemical project has entered continuousproduction and so far has produced 127,000 tons of polypropylene in 1H13, in linewith our forecast. However, the project has incurred pre tax losses of Rmb519mnon the back of total revenue of Rmb1,790mn. We believe the loss is due to highdepreciation and finance costs of the project. We await more information on coalchemicalprojects such as ASP and unit production cost guidance at a resultsbriefing to be held at 9:30 HK time on 26 Aug 2013 in Hong Kong.

EPS estimates and PO lowered; maintain Neutral

We lower our 2013-15 EPS estimates for Datang by 9.1-5.0%, after lifting our coalsales cost, and operating cost (such as depreciation cost), but offset by lowerthan estimated finance expense. We lower our PO from HK$3.9 to HK$3.8 andmaintain our Neutral rating. Our revised PO implies 2013-14 PE multiple of 9.0-7.8x, vs its current share price implied PE of 7.8-6.8x.

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