HK Stock Market Move | POWER ASSETS (00006) rises nearly 3% as energy transition boosts capital spending; institutions expect regulatory grid business to benefit the company.

POWER ASSETS (00006) rose nearly 3%, closing at a 2.46% increase at 58.2 Hong Kong dollars, with a trading volume of 2.29 billion Hong Kong dollars. Bank of America released a research report stating that it expects POWER ASSETS to achieve a compound annual growth rate of 6% in profits for the fiscal years 2024 to 2027, as regulatory adjustments in 2025 to 2026 will significantly improve the return on equity of its Australian assets. The capital expenditure driven by energy transition will benefit the company's regulated electricity grid business. In addition, its 50% profits from the UK will also benefit from the depreciation of the US dollar. The bank pointed out that acquisition activities and capital recycling could bring additional upside potential for operating funds, and expects operating fund growth to exceed dividend growth, thus creating potential growth space for mid-term dividends. The Fed's interest rate cut cycle and potential M&A success will serve as catalysts for stock price.