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HPI - Powering the Future October 1994 PowerPoint Presentation
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HPI - Powering the Future October 1994 - PowerPoint PPT Presentation


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HPI - Powering the Future October 1994. Agenda. Political and economic climate Power industry Corporate profile Operations Prospect. Agenda. Political and economic climate Power industry Corporate profile Operations Prospect. Political Background.

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Presentation Transcript
slide2

Agenda

  • Political and economic climate
  • Power industry
  • Corporate profile
  • Operations
  • Prospect
slide3

Agenda

  • Political and economic climate
  • Power industry
  • Corporate profile
  • Operations
  • Prospect
slide4

Political Background

  • Decision to undertake a fundamental economic reform in 1978
  • Smooth leadership transfer in 1989
  • Reinforcement of reform’s importance and necessity in 1992
slide5

Economic Growth

  • GNP increased gradually in the past five years and will grow at estimated rate of 7% to 9%
slide6

Economic Climate

  • Fully controlled currency exchange rate
  • Soft correction policy

to control inflation

  • Preferential tax policy

for foreign investors

  • Pegged RMB to US dollar at 1:8.7 since January 1, 1994
slide7

Agenda

  • Political and economic climate
  • Power industry
  • Corporate profile
  • Operations
  • Prospect
slide8

Power Industry

Rivalry among Existing

Power Companies

Industry Overview

High Entry Barriers

PotentialEntrants

Suppliers

Buyers

Sufficient Supply

Huge Demand

Substitutes

Few Substitutes

slide9

Shanxi

2000 Required Capacity (MW)

1992 Installed Capacity (MW)

Power Requirements

0 10,000 20,000 30,000

slide10

Retail

Electricity Generation

Distribution (Low Voltage)

Raw Material Purchase

Transmis-sion (High Voltage)

End Users

Industry Value Chain

slide11

Agenda

  • Political and economic climate
  • Power industry
  • Corporate profile
  • Operations
  • Prospect
slide12

Company Profile

  • Founded in June, 1994, with a mandate to develop and operate large power plants in China
  • A spin-off of high quality assets from HPIDC
  • Total Assets: 1.36 billion
  • Net Income: 96.2 million
  • ROE: 15.8%
  • Installed Capability: 2,900 MW
  • All plant construction projects were completed on time and within budget
slide13

Proposed Ownership

Ministry of Electrical Power

Foreign Director Investors

China Huaneng Group

Local Government Investment Corp.

35%

HPIDC

40%

Holders of Shares of Global Equity Offering

25%

Huaneng Power International Inc. (HPI)

slide14

Sustainable Competitiveness

  • Strong support from central and local government
  • Advantage of economy of scale
  • Strategic development through acquisition and expansion
  • Operational efficiency
slide15

Agenda

  • Political and economic climate
  • Power industry
  • Corporate profile
  • Operations
  • Prospect
slide17

Management

  • Experienced management team in power generation and plant management
  • Good relationship with HPIDC, central and local government.
slide18

Agenda

  • Political and economic climate
  • Power industry
  • Corporate profile
  • Operations
  • Prospect
slide19

Guaranteed rate of return

  • To reduce the risk of investing in China
  • To allow HPI to adjust its rates to recover higher input costs
  • Incoming legislation on guaranteed return rate
slide22

Q & A

Thank you !