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Ahead of 3Q results release of IPPs starting 21 October, Morgan Stanley, in its latest research report, noted that due to the excess supply of electricity in Mainland coastal areas, inland IPPs have been outperforming when compared to coastal IPPs. HUANENG POWER (00902.HK)  +0.180 (+2.081%)    Short selling $99.03M; Ratio 36.864%   and CHINA RES POWER (00836.HK)  +0.200 (+0.962%)    Short selling $13.92M; Ratio 9.752%   will be avoided by the research house due to continued decline in coal utilization hours.

Morgan Stanley said HUADIAN POWER (01071.HK)  +0.010 (+0.188%)    Short selling $4.78M; Ratio 10.417%   and DATANG POWER (00991.HK)  +0.010 (+0.264%)    Short selling $1.51M; Ratio 2.853%   remained as the top picks, as the former is seeing potential injection in the aspect of coal and hydro, while the latter may create value by coal-chemical restructuring.

CHINA RES POWER was rated Equalweight with target cut from $24.5 to $23; HUANENG POWER was rated Equalweight with target cut from $9.8 to $10.2; DATANG POWER was rated Overweight with target maintained at $5; HUADIAN POWER was rated Overweight with target raised from $7.2 to $7.3

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