China Resources Power drops 3% but UBS bullish on share price rise

China Resources Power, which has been awarded a maximum of 3 billion yuan per year for the Wind power investment scheme, has rebounded, with shares falling 3.23% to HK $18 and trading 18.24 million shares.　　But UBS issued a report saying that the purchase rating of the unit was maintained at a target price of HK $21.6, at a premium of 20% per cent. UBS pointed out that China resources power to carry out 10 for 1 of the shares means that it may have a 10% dilution effect, which may reduce the estimated net present value based on discounted cash flow to HK $20.9 from HK $21.6, but it still means there is a lot of room for stock prices.　　At the same time, it could reduce the net debt equity of 2009 years to 75% from 105%. UBS believes the return of the unit is the best in its peers and is best able to withstand downside risks. It is also bullish on the expansion of its coal reserves, which help it get fuel supplies and help hedge fuel costs.