Valuation Comparison and Investment Value Analysis Between Thermal Power Central SOEs and the Big Four Banks

This analysis focuses on the valuation and investment value of thermal power central SOEs (taking Huaneng Power International as an example) and the Big Four Banks, based on social media analysis data [0]. The main findings are as follows:

1. Price-to-Book (P/B) Ratio Correction
   : The original statement in the query that Huaneng Power International had a 0.6x P/B ratio and the Big Four Banks had a 1x P/B ratio was inaccurate. The latest data shows: Huaneng Power International (600011.SS) has a P/B ratio of 0.85x; all Big Four Banks are below 1x—Industrial and Commercial Bank of China (601398.SS) at 0.72x, Agricultural Bank of China (601288.SS) at 0.84x, Bank of China (601988.SS) at 0.54x, China Construction Bank (601939.SS) at 0.67x, with an average of approximately 0.69x.
2. Return on Equity (ROE)
   : Huaneng Power International’s ROE is 10.25%, which is competitive compared to the Big Four Banks—slightly higher than ICBC, ABC, and BOC, and close to CCB’s 10.17%.
3. Profit Margin
   : Huaneng Power International’s net profit margin is 6.22% and operating profit margin is 10.98%, significantly lower than the Big Four Banks’ net profit margins of 19.70%-41.19% and operating profit margins of 24.62%-41.43%.
4. Cash Flow
   : Huaneng Power International’s latest quarterly free cash flow (FCF) in 2025 is 8.09 billion yuan (positive), but it was -13.12 billion yuan (negative) for the full year of 2024; the report does not provide specific cash flow data for the Big Four Banks, but their high profit margins suggest strong cash flow generation potential.
5. Stock Price Performance
   : Huaneng Power International has risen 21.65% year-to-date in 2025; the Big Four Banks have mixed performance, with Agricultural Bank of China up 46.92% and the others with lower gains.

1. Valuation Premise Correction
   : The assumption in the original query that bank stocks have a 1x P/B ratio is invalid. Currently, both thermal power central SOEs and the Big Four Banks are in a state of below-book-value valuation, so the valuation comparison needs to be reconsidered based on actual data.
2. ROE Competitiveness
   : Huaneng Power International’s ROE is close to that of CCB, the leader among the Big Four Banks. Against the backdrop of below-book-value valuation, its ROE performance highlights relative valuation attractiveness, although its profit margin is lower than that of the banks.
3. Cash Flow Diversification
   : Huaneng Power International’s positive quarterly cash flow contrasts with its negative annual cash flow, which may reflect industry cyclicality or phased improvement; continuous attention should be paid to its cash flow stability.

: Huaneng Power International’s negative full-year free cash flow in 2024 and high debt risk deserve attention; the overall ROE of the Big Four Banks has no significant advantage over thermal power central SOEs, and the mixed performance of their stock prices increases uncertainty.
: Huaneng Power International’s ROE is competitive, and its stock price has performed steadily year-to-date in 2025; some banks (such as Agricultural Bank of China) have seen significant stock price increases, which may reflect the market’s re-recognition of their value.

This analysis corrects the valuation data bias in the original query, pointing out that both Huaneng Power International and the Big Four Banks are in a state of below-book-value valuation. Huaneng Power International’s ROE is competitive compared to the Big Four Banks, but there are differences in profit margin and cash flow stability. Their stock price performance has been mixed year-to-date in 2025. Investors should make decisions based on actual financial indicators and industry trends, combined with their own risk preferences and investment cycles.