Citigroup has issued a research report, revising its target price for ENN ENERGY (02688) H-shares downward by 31% to HK$50 from HK$72, and downgrading its rating from "Buy" to "Neutral".

The downgrade follows the cancellation of a privatization plan for ENN ENERGY by its parent company, ENN Natural Gas Co., Ltd. (600803.SH). The transaction had been awaiting approval from the China Securities Regulatory Commission for nearly a year, and the timeline for meeting all conditions remains unclear.

From a fundamental perspective, ENN ENERGY's outlook is not favorable, characterized by weak growth in retail gas sales, a decline in new household customer additions, and a decrease in integrated energy sales. The bank believes the cancellation of the privatization plan indicates a lack of near-term positive catalysts for the stock.

The bank forecasts a dividend yield of 6.4% for the company in 2026. Given the backdrop of rising global LNG prices, Citigroup expresses a more favorable view of the parent company, ENN Natural Gas, citing potential for expansion in its upstream direct gas sales business.