Main points of investment
Event: Yongqing waste disposal, a wholly owned subsidiary of the company, plans to acquire 100% equity in Shanghai Delong and Hangzhou Fengdi for 160 million yuan.
The acquisition of Yunnan Province regional hazardous waste leader Yunnan Daifengyuan, hazardous waste field and the next city. After the completion of this equity transfer, the company will hold 100% equity in Shanghai Delong and Hangzhou Fengdi, and 66% equity in Yunnan Dafengyuan indirectly. Dafengyuan is the legal operator of Kunming Hazardous waste treatment and disposal Center, which is responsible for the investment, design, construction and operation of the "Hazardous waste Center" project, which is the first large-scale and exemplary important environmental protection project in Yunnan Province. Dafengyuan disposes of hazardous waste from Kunming and its surrounding areas by franchise for a period of 25 years. At present, Dafengyuan is mainly engaged in harmless disposal and comprehensive utilization of hazardous wastes, with incineration, physicochemical, stable solidification, safe landfill and comprehensive recycling facilities, complete facilities, a total of 37 categories of hazardous waste disposal qualifications. The approved disposal scale is 330,000 tons / year, including 9000 tons / year incineration and disposal production line, 10000 tons / year landfill disposal production line, 10000 tons / year physicochemical disposal production line and 4000 tons / year comprehensive utilization production line. In the first 10 months of 2017, Dafengyuan had an income of 46.32 million yuan and a net profit of 10.21 million yuan. After stable production, the performance of the target company will be greatly improved, which will have a positive impact on the performance of the company.
The acquisition of Kangbo solid waste will strongly enter the field of dangerous waste in Jiangsu: Yongqing Environmental Protection plans to purchase 100% equity of Kangbo solid waste held by Yongqing Group and Hangxiang Swan by issuing shares and pay the consideration of 1.075 billion yuan. Kangbo solid waste has become a wholly-owned subsidiary of Yongqing Environmental Protection after the completion of this transaction. The target company promises to deduct the non-return net profit of 106 million yuan, 106 million yuan, 113 million yuan and 120 million yuan in 17-20 years, and the corresponding valuation of the purchase price in 17 years is 10.1 times. This acquisition will enable Yongqing Environmental Protection to strongly enter the field of hazardous waste in Jiangsu Province and achieve synergy with the environmental protection services of the original company. Kangbo solid waste has the ability to dispose of hazardous waste in a wide range, and the disposal technology is reliable and stable. With the stricter national environmental protection policy, the unit price of hazardous waste disposal increases rapidly, the market prospect is broad, and the company's hazardous waste disposal performance is expected to be greatly improved.
The advantages of soil remediation technology, recently won the bid: in January 18, the company won the bid value of 570 million of the Taojia River Basin comprehensive treatment project of heavy metal pollution, coupled with 17 years of orders, indicating that the future performance improvement is guaranteed.
The company has obtained the Class A certificate of environmental impact assessment, and the EIA consulting project is growing rapidly: in August 2016, the company obtained the EIA Class A certificate, which can help the company to further improve its contracting ability of EIA consultation. give the company more room for growth in the field of EIA consulting services. And in 14-16 years, EIA consultation achieved an average annual compound growth rate of 123.6%, and EIA still achieved an increase of more than 100% in the first half of 17 years. The company's EIA consulting performance is still expected to grow by a large margin in the future.
Profit forecast and investment advice: the EPS from 2017 to 2019 is expected to be 0.25,0.48,0.61 yuan respectively; compared with companies in the same industry, the growth rate of the company's performance is higher, the valuation is relatively low, and the "overweight" rating is maintained.
Risk hint: competition aggravates the risk, the project schedule is not as good as the expected risk, etc.
