The leading enterprises in the field of environmental monitoring are escorted by "technology + products + funds". The company started from the sales of CEMS in the power industry, and has achieved comprehensive coverage of atmosphere, water, pollution sources, carbon monitoring and so on. The company has shown strong development resilience under 22 years of macroeconomic pressure: according to the company's annual report, the company achieved revenue of 1.505 billion yuan (year-on-year + 8.97%) and net profit of 284 million yuan (year-on-year + 27.89%) in 22 years. With abundant instrument production capacity and abundant capital on hand, the company is expected to expand the field of environmental monitoring and high-end scientific instruments by relying on the profound technical background of the founder and R & D team.
Non-electric pollution source monitoring to create a basic business disk, thermal power installation, non-electric ultra-low emissions and other new demand to ensure growth. According to the company's annual report, in 2022, the company's equipment revenue (860 million yuan for environmental monitoring & 90 million yuan for industrial process analysis & 210 million yuan for gas analyzers and spare parts), service revenue (320 million yuan for system transformation and operation and maintenance), and EPC (30 million yuan for energy saving and environmental protection projects) accounted for 77%, 21%, 2%. According to the comprehensive calculation, the sales market of pollution source monitoring equipment during the 14th five-year Plan period reached 28.9 billion yuan, and the final operation and maintenance market reached 8.4 billion yuan per year. The incremental demand of superimposed thermal power newly installed (about 700 million yuan market space for monitoring equipment) and ultra-low emission transformation of the iron and steel industry (about 1.8 billion yuan market space for monitoring equipment) ensures the growth of environmental monitoring business in the next three years.
Carbon monitoring opens the room for growth and attaches importance to the emerging potential units of scientific instruments. (1) carbon monitoring: with the restart of the CCER market, using CEMS to measure carbon data will become an important basis for carbon monitoring. We estimate that the space of carbon monitoring equipment will be up to 12 billion yuan in the next three to five years; while carbon monitoring and pollution source monitoring customers are basically the same, the company is expected to stand out. (2) Scientific instruments: relying on overseas mergers and acquisitions, the company focuses on chromatography, time-of-flight mass spectrometer, and the prototype of scientific instrument platform is beginning to emerge.
Profit forecast and investment advice. It is estimated that the net profit of homing in 2023-25 is 3.06 pound 3.62 / 436 million yuan, corresponding to the corresponding PE of 18.6 shock 15.7 pound 13.0x, with reference to the comparable company's 2023 25xPE, corresponding to the fair value of 12.12 yuan per share, the first time to give a "buy" rating.
Risk hint. The acquisition of orders is not as expected; the competition aggravates the risk; the risk of bad debts and so on.