HK Stock Market Move | XINYI ENERGY (03868) surged more than 56% during trading. Earlier announced listing of CECEP Solar Energy power station REIT will help improve the company's financial situation.

XINYI ENERGY (03868) rose by over 56% during trading, and at the time of writing, it had risen by 22.22% to 1.43 Hong Kong dollars, with a turnover of 2.97 billion Hong Kong dollars. On the news front, recently, XINYI ENERGY and XINYI SOLAR jointly issued a voluntary announcement, suggesting that the application materials for the listing and issuance of CECEP Solar Energy power plant infrastructure REIT in China have been submitted to the NDRC. The relevant assets of CECEP Solar Energy power plant infrastructure REIT include selected power plant projects currently owned and operated by XINYI ENERGY. Guoyuan International pointed out that selling power plant assets through REITs will not only revitalize existing assets, alleviate cash flow pressure caused by delayed subsidies, but also lower financial leverage through equity financing and debt substitution, further reducing financing costs and interest expenses. The Chinese REITs market has strong demand for stable income assets, combined with support for the "dual carbon" policy. If the selected projects are power plants in the subsidy catalogue, the cash flow certainty is stronger and more favored by investors. Furthermore, REIT listings usually require a high dividend payout ratio, which may prompt companies to further increase dividend payouts, providing potential for future dividend yield expansion.