Gas distributors in Asian markets are projected to face a margin squeeze due to rising costs amid price ceilings by China. Gas producers and exporters are likely to benefit from the surging prices.
- Independent coal-fired energy producers in China are expected to post third-quarter losses due to higher costs. The companies are unable to pass the costs to consumers due to China’s regulations.
- Rising electricity costs could hurt intensive power use companies, with stocks of Aluminum Corporation of China Ltd., Angang Steel Co., and Zhejiang Longsheng Group Co. some of the biggest losers.
- Carmakers and suppliers of iPhones are other losers and have already cut production at certain facilities to meet tighter energy-use policy by China.
- Coal mining could benefit from the higher prices of the commodity, with names such as China Shenhua Energy Co., potential gainers. Stocks of coal-fired producers are expected to post declines.
- Green energy companies generating power from renewable sources such as water and wind are projected to gain. Already, China Longyuan Power Group Corp. hit a record on Tuesday, after rising by 21% in five sessions.
More than 20 provinces and regions accounting for more than two-thirds of China’s GDP have announced power rationing. Other areas have stopped electricity flows to attain energy intensity goals and emissions.
