Comprehensive environmental management quotient with comprehensive development of water, solid, gas and energy. The company has gone through three stages: the rapid expansion of solid waste business (2014-2015), the rapid expansion of environmental protection projects (2016-2018), and the continuous operation of invested water and solid waste projects (2019 to date), promoting the continuous high-quality improvement of the company's revenue performance, with a compound growth rate of 22.35% in the past five years. At the end of 2021, the company completed the acquisition of the first atmosphere, and in the future, it will build urban environmental protection clusters and build integrated and integrated environmental managers by promoting the comprehensive development of "water, solid, gas and energy" business. The company issued a 2021 performance forecast, which is expected to achieve a net profit of 22.1-2.35 billion yuan (+ 50-60% compared with the same period last year).
With the rapid growth of water affairs, the incineration business continues to develop. Water, the company as the industry's leading capacity layout, as of 2021, the company's water supply + sewage total capacity (including shares) reached 2344 million tons / day. In recent years, the company has strengthened the adjustment of water prices, raising the average price of per ton tap water to 1.95 yuan per ton from 1.69 yuan per ton in 2016, and the average price per ton of sewage treatment from 0.88 yuan per ton to 1.70 yuan per ton, leading to the continuous improvement of the company's ROE. In addition, the company's waste disposal capacity has reached 13.72 million tons / year, 73 projects in hand, with the commissioning of new projects, the handling capacity will continue to increase.
The first batch of REITs issues to invigorate existing assets and promote revaluation. The company issued a public REITs with two sewage treatment projects as the underlying assets, with an offering size of 1.85 billion yuan, with an increase of 105.7% by February 14, 22, the first increase in the first batch of nine public REITs projects. Issuing public REITs helps the company to invigorate existing assets, promote asset revaluation, accelerate capital turnover through light asset mode, and achieve operating income through project operation.
Profit forecast and investment advice. It is estimated that the company's net return profit from 2021 to 2023 is 21.4 billion yuan, which is 8.2 times higher than the PE corresponding to the latest closing price. As the leader of comprehensive environmental governance, with the continuous operation of the project, the performance is expected to maintain high-speed growth. Combined with the valuation of interbank companies and the growth of corporate performance, we give the company 15 times PE valuation in 2022, corresponding to a reasonable value of 4.96 yuan per share, with a "buy" rating for the first time.
Risk hint. The financing environment has tightened; production capacity has been released less than expected; and the scale of government investment has declined.