We See Higher Capital Expenditures for CLP Leading to a Lower FVE; 2022 Earnings Fall Short

With a regulated return from its Hong Kong utility business expected to make up more than 70% of recurring net profit, CLP has been able to enjoy stable cash flows that have allowed it to keep annual dividend growth of 2% over the past decade, which we think is ultimately maintainable. This is likely to support a stable share price, and CLP has a relatively decent dividend yield of around 5.7% as of Feb. 27, 2023.