Keystone. On September 8th, Entrepreneurship and Environmental Protection issued a non-public offering plan, which intends to issue no more than 250 million shares to no more than 10 specific targets, the total amount of funds raised shall not exceed 1.837 billion yuan, and the issue price will not be less than 7.33 yuan per share, with a lock-up period of one year. The funds are mainly used for water, new energy cooling and heating, supplementary working capital, and so on.
Increase the power of water PPP. The company plans to raise 1.04 billion yuan of the additional funds for the expansion and bid raising project of Beicang and Jingu sewage treatment plant. Among them, Beicang waterworks plans to raise 370 million yuan, the scale is expanded from the existing 50, 000 m3 / d to 150000 m3 / d, and the Jingu waterworks is proposed to raise 670 million yuan, from the existing 550000 / m3 / d to 650000 / m3 / d After the transformation of the two waterworks, the discharge standards will be raised from the current level B to level A. In addition, since the beginning of this year, the company has successively won the bid for Yingshang Chengnan sewage treatment Plant, Ningxiang sewage treatment Plant and other PPP projects. Among the current many PPP projects, water projects have the most stable cash flow and the highest conversion rate of orders to performance because of their mature business model (a stable source of funds for urban tap water charges and sewage treatment charges). As of the second quarter of 2016, Entrepreneurship Environmental Protection has a franchise sewage treatment scale of about 3.12 million cubic meters per day, and its business involves 11 provinces and cities, including Tianjin, Qujing, Hangzhou and Xi'an. It is a well-deserved water giant. Rich operation and management experience and sufficient financial support will bring more PPP orders for the company and promote the sustained growth of the company's performance in the future.
Join hands with Jin membrane, strong combination, complementary advantages. In September 2015, the company signed the Strategic Cooperation Framework Agreement with Tianjin Film Science and Technology to strengthen the technological docking and joint development of both sides, complement each other's advantages and jointly open up the market.
Tianjin membrane science and technology is a leading membrane production enterprise in Tianjin, and its membrane technology and brand industry have considerable recognition. Under the general trend of national water standard raising, the application proportion of membrane will increase rapidly, and the cooperation with Tianjin film will bring strong membrane equipment and material resources for entrepreneurial environmental protection, and provide better quality assurance for its water PPP project.
Actively develop urban new energy supply business. Another 240 million of the increase plan will be used for the construction of two energy stations in Heiniu Street in Tianjin. These two projects adopt the more advanced ground source heat pump system at present, and use the shallow ground to heat and cool the buildings on both sides of the street. at present, it is widely used abroad, but it is still rare in China, so it is a real low-carbon green urban energy supply scheme. This indicates that the company develops and tries new clean and renewable urban energy supply schemes on the basis of traditional heating business, which is in line with the main trend and general trend of urban energy supply, and lays the foundation for the company to undertake urban comprehensive PPP projects in the future.
Profit forecast and valuation. It is estimated that the company will achieve net profit of 3.57 and 385 million yuan in 16-17 years, corresponding to 0.25,0.27 yuan per share of EPS. With reference to the valuation of comparable company and the expectation of rapid expansion of the company's new business in water PPP and ground source heat pump in the future, the company will be given 42 times PE in 16 years, corresponding to the target price of 10.5 yuan. Buy rating.
Risk hint. The fixed increase progress is not up to expectation; the integration with the film resources is not smooth; the technical risk of ground source heat pump.