The net profit of homing in 2021 increased by 9.8% compared with the same period last year, maintaining the "buy" rating company's revenue / net profit of 7102 million yuan in 2021, an increase of 57.4% over the same period last year. The net profit of homing was 9.7% lower than Huatai's expectation (Huatai's expectation: 761 million yuan), of which the substantial increase in engineering revenue drove the rapid growth of revenue. Changes in the income structure affected the composite gross profit margin fell 4.9pct to 25.3% year-on-year, and the expense rate rose 0.3pct to 10.8% year-on-year, jointly promoting the return net interest rate to decline 4.8pct to 11.7% year on year. We lowered the 22-23 year net profit forecast to 794 million yuan (previous value: 991 million), introduced the 24-year net profit forecast of 1.088 billion yuan, and gave the company a target PE of 19x for 22 years, with a target price of 13.49 yuan.
Increased revenue from construction services and rapid growth in operating capacity
According to the PPP project contract, it is confirmed that the revenue from construction services is 1.99 billion yuan, accounting for 28.0% of the total revenue, and its cost profit margin is determined by the cost addition method with reference to similar construction services. In 2021, 11 new municipal solid waste incineration projects were put into operation, corresponding to an additional production capacity of 11850 tons per day. The incineration capacity of the company's domestic waste has been increased to 38650 tons per day. In 2021, a total of 12.66 million tons of factory waste was included, an increase of 31.1% over the same period last year (including the commissioned operation of Laogang Phase I and Phase II). The power consumption of waste incineration was 4.16 billion kWh, an increase of 31.6% over the same period last year.
The emerging business goes hand in hand and the asset model is both important and important.
The company takes "planning consultation, ecological restoration, construction escrow" three light assets business and "domestic waste, hazardous medical waste, sewage treatment" three heavy assets business as the main line, a clear focus on the development orientation of both priority and two-wheel drive. In terms of project expansion, in 2021, the company added the resource and harmless comprehensive disposal center project of industrial waste in central Hubei Province, completed more than 80 contaminated sites and environmental restoration business, and signed 214 technical service contracts, laying a solid foundation for the company's transformation, upgrading and sustainable development.
Ample cash flow and maintain "buy" rating
In 2021, the net operating cash flow decreased from 1.04 billion yuan to 570 million yuan. If the construction expenditure of the PPP project is not taken into account, the operating cash inflow of the company is 1.37 billion yuan. We expect that the operation of the waste incineration project will bring abundant operating cash inflows. According to the project construction and operation of the company, we reduced the operating income of waste incineration, and then lowered the 22-23 year return net profit forecast to 794 million yuan (the previous value: 991 million yuan), and introduced the 24-year return net profit forecast of 1.088 billion yuan, corresponding to the 22-24 year EPS is 0.71 pound 0.84 yuan 0.97 yuan, with reference to the comparable company's 22-year Wind consensus forecast PE average 14x Considering that the company is the leader of solid waste in Shanghai and the high quality of the project on hand, it gives the company a target PE of 19x in 22, with a target price of 13.49 yuan (previous value: 14.44 yuan) to maintain "buy".
Risk hint: the risk of electricity price reduction of garbage generation, the project schedule is not up to expectation, and the project operation risk.
