The relevant review situation of the European Union has gradually become clear, and there is a lot of room for profit repair of ester-based biodiesel.

The wait-and-see mood brought about by the review of raw materials and origin has led to a decline in the price of domestic ester-based biodiesel and a significant increase in the export price gap. As the situation gradually becomes clear, the profits from the production of ester-based biodiesel are expected to be significantly repaired. In the long run, the review leads to a decline in domestic non-compliance capacity and palm oil-based competitive production capacity, and supply-side reform in disguise is beneficial to the long-term development of domestic enterprises with gutter oil / hogwash oil as raw materials.

Environmental protection plus economic recovery + El Nino, biodiesel is expected to rise in volume and price in the medium term.

The European Parliament has adopted the Renewable Energy Directive (RED III), which will boost demand for biodiesel in Europe by raising renewable energy targets for 2030 and increasing emissions reduction targets for the transport sector. The decline in demand for biodiesel in recent years is more affected by the economic environment, and biodiesel is expected to rise in volume and price with a soft landing in Europe and a potential rise in palm oil prices brought about by El Ni ñ o.

Bio-aviation coal has broad prospects, capacity investment to create a second growth curve, the European Union has issued a series of policies to promote the application scope of bio-aviation coal industry. RefuelEU regulations require bio-aviation coal to account for 2% of aviation fuel in 2025 and 70% in 2050. At the same time, the United States and China are also actively promoting aviation carbon reduction and bio-aviation coal blending plans. The company's 200,000 tons / year hydrocarbon-based biodiesel (and bio-aviation coal) production line and 50,000 tons / year natural fatty alcohol production line are steadily advancing, and the performance is expected to be greatly increased after it is put into production.

Profit forecast

The forecast company's income from 2023 to 2025 is 38.9,44.8 and 6.54 billion yuan respectively, EPS is 2.51,3.46,6.25 yuan respectively, and the current stock price corresponds to PE 19.5,14.1 and 7.8 times respectively, maintaining the "buy" investment rating.

Risk hint

The economy is in the doldrums; raw material prices fluctuate sharply; production capacity is less than expected; downstream demand is lower than expected; the company's product prices fluctuate greatly.