This report is read as follows:
Kaishan wellhead module power station is expected to be popularized in Indonesia, and the EPC market for power station construction is expected to speed up. With the increase in domestic demand for air compressors, the steady increase in the scale of self-operation of power plants, and the acceleration of EPC development, the company's performance will enter a period of explosive growth.
Main points of investment:
Conclusion: the company issued a performance forecast that Q1-Q3 made a profit of 1.7-200 million yuan, an increase of 90-120%, of which Q3 made a profit of 0.63-78 million yuan, an increase of 70-110%, slightly exceeding expectations, raising EPS to 0.32 yuan (+ 0.01yuan) in 2020 and 0.59,0.78 yuan in 2021-22 EPS. Indonesia will upgrade Kaishan SMGP to a national key project, judging that Kaishan wellhead module power station may be used as a future technical route, and the construction of EPC is expected to speed up, maintain the target price of 30.83 yuan, and increase its capacity.
The demand for traditional domestic air compressors has increased, and the stable operation of the power plant has increased its performance. In September, the second phase of SMGP needs to be shut down for 7-9 days, resulting in a slight decrease in Q3 electricity sales revenue from the previous month, which is expected to be about 19 million yuan. at the same time, the grid connection of booster stations in November will also affect Q47-9 days of power generation. The compressor business is expected to make a profit of 0.44-59 million yuan, an increase of 19-59%. On the one hand, it is due to the increase in domestic demand for traditional air compressors, on the other hand, Q1-Q3 Austria LMF reduces losses, and Q3 American KCA also resumes growth.
Indonesia will upgrade its SMGP to a national key project, and the construction of EPC is expected to speed up. In May, GDE, a subsidiary of PLN, received a $300 million loan from the ADB for the construction of two geothermal power stations (110MW). Considering Indonesia's upgrading of Kaishan SMGP to a national priority project, GDE may use the wellhead module power station as a future technical route. In August, the EPC contract for SMGPL 65 million $geothermal power plant in Kenya received an advance payment of $10 million, marking the formal entry into force of the contract and contributing to performance flexibility in 2021.
The construction of the power station is progressing steadily, and it is expected to add 60-70MW every year. The start of the mountain is about hand geothermal resource 500MW, and it is expected that 60-70MW will be installed every year. Due to the impact of the epidemic, the US Star Peak Phase I 12.5MW, Hungary Turawell Phase I 5MW and SMGP Phase II 45MW originally planned to be installed in 2020 are all expected to be put into operation, and the third phase of SMGP 50MW is also being stepped up construction.
Risk tips: repeated overseas outbreaks have led to delays in the development of power plants; follow-up financing is not up to expectations.
