华润燃气(01193) 　　What’s happened? China Resources Gas has formed a joint venture with sister company China Resources Power tosupply power to non-residential users in Fujian province. CR Gas will own 49% of the JV and CR Power will own 51%. 　　The JV will have total registered capital of Rmb210MM. 　　J.P. Morgan’s comments. CR Gas has five city-gas projects in Fujian, including Xiamen, Fuzhou and Longyan. 　　Given CR Gas’s network of commercial and industrial customers in these cities, the partnership could create synergies, in our view. However, the power retail business is still in the preliminary phase of reform and the models and returns of these businesses are not clear. We view this as a neutral event for CR Gas as there will unlikely be much earnings impact in the near term. CR Gas will likely make only minimal investments into the JV in the initial phase. 　　Given gas distributors’ broad network of commercial and industrial customer base, we believe more of them will likely expand into the retail power business in future. Within China gas utilities, we think ENN (2688HK), at 11x 1-year forward P/E, provides the best value at current level.