Comparative Analysis of Investment Value Between Thermal Power Stocks and Bank Stocks

Investors compared their experience of not gaining positive returns from investing in two joint-stock banks in Shenzhen since early 2022, and put forward the view that thermal power stocks have stronger investment attractiveness. The core basis includes the perpetuity of the power industry, transparency of asset quality, and high dividend commitments [1]. From the perspective of industry characteristics, as a basic energy source, electricity has rigid demand, so the industry has perpetuity, and the coal-power price linkage mechanism allows power enterprises to pass on cost pressures [2]; thermal power enterprises’ assets are mainly physical assets such as power plants, with transparent valuation—Huaneng International H-share (0902.HK) has a price-to-book ratio of only 0.59 [3]; bank assets are mainly loans, with credit risks and complexity in impairment provisioning—joint-stock banks like China Merchants Bank have a price-to-book ratio of about 0.95 [3]. In terms of dividends, Huaneng International clearly states that the cash dividend ratio will not be less than 50% [4], while the dividend ratio of banks is generally between 30% and 40% [5].

1. Asset Quality and Valuation Differences
   : The physical asset attribute of thermal power stocks reduces the uncertainty of asset valuation, and the low price-to-book ratio reflects the market’s undervaluation of their asset value; the asset quality of bank stocks is greatly affected by macroeconomics and credit risks, and the valuation implies concerns about future risks [6].
2. Dividend Capacity and Commitment Rigidity
   : The high dividend commitment (≥50%) of thermal power stocks improves the predictability of returns, while the dividend ratio of bank stocks is greatly affected by profit fluctuations and regulatory requirements, with relatively weak stability [4][5].
3. Historical Performance Verification
   : Ping An Bank (000001.SZ) fell by 29.98% from 2022 to 2025, and Huaneng International A-share (600011.SS) fell by 19.56% in the same period. Investors’ loss experience in bank stock investment is consistent with the actual market performance [7][8].

• Risks
  : Electricity price adjustment is regulated by the government, and the effectiveness of the inflation pass-through mechanism needs to pay attention to policy changes; the profit of thermal power stocks is affected by coal price fluctuations, and cost control pressure continues; bank stocks face credit risk exposure in the economic downturn cycle [2][9].
• Opportunities
  : The low price-to-book ratio and high dividend commitment of thermal power stocks provide valuation repair opportunities for long-term investors; some high-quality bank stocks still have attractive dividend yields, such as China Merchants Bank H-share with a dividend yield of about 4.26% [3].

Thermal power stocks have advantages in asset quality transparency, price-to-book ratio valuation, and dividend commitment, but need to pay attention to policy and cost risks; bank stocks have high asset quality complexity, but some targets still have competitive dividend yields. Historical performance shows that bank stocks fell more than thermal power stocks, but the future investment value needs to be comprehensively judged based on macroeconomics, industry policies, and individual company conditions.

[0] Jinling Analysis Database
[1] Social Media Investor Discussions
[2] National Development and Reform Commission: Notice on Establishing a Coal-Power Price Linkage Mechanism
[3] Yahoo Finance: Huaneng International Power Co., Ltd. H-share (0902.HK)
[4] Huaneng International 2025 Interim Report
[5] Sina Finance: Over 260 Billion Yuan! Bank Stocks’ ‘Red Envelope Rain’ is Coming—What’s Different About This Year’s Interim Dividends?
[6] Market Industry Research and Analysis
[7] Jinling Analysis Database: Ping An Bank (000001.SZ) Price Data
[8] Jinling Analysis Database: Huaneng International (600011.SS) Price Data
[9] Macroeconomic and Industry Policy Analysis