The company is the market leader of domestic environmental monitoring, with perfect product system and rich experience in technical practice. Founded in 2001, the company focused on the research and development of industrial process analysis system, then gradually set foot in new fields such as atmospheric environmental monitoring and carbon emission monitoring, and acquired KORE in the United Kingdom and ORTHODYNE S.A. In Belgium, and set up two overseas R & D centers. At present, the company has formed four major business sectors, including environmental monitoring, carbon emissions and greenhouse gas monitoring, industrial process analysis, and scientific instruments. Among them, environmental monitoring business covers water, atmosphere, soil, pollution source monitoring and other aspects, and through the big data platform to achieve regulatory precision. (1) pollution source monitoring: the company's pollution source monitoring business covers many sub-areas such as thermal power / iron and steel ultra-low emission transformation, VOCs, waste incineration and heavy metal monitoring, with rich experience in the project. Downstream customers include Datang Group, China Resources Thermal Power, Wuhan Iron and Steel, etc. With the continuous promotion of the "three reforms linkage" of coal-fired power units and the ultra-low emission transformation in the non-electricity field, the pollution source monitoring market is expected to further grow; (2) Water environment monitoring: under the requirements of the "outline of National Water Network Construction Plan" and "three-water co-governance", water quality monitoring will be transformed into water ecological monitoring, the coverage of water monitoring sites will be further increased, the monitoring ranks will sink, and the types of monitoring factors will be expanded. The company's water environment monitoring products match a variety of monitoring scenarios, and the types of monitoring factors cover heavy metals, nitrate nitrogen, fluoride, sulfides and other aspects, and are expected to benefit from the development of water environment monitoring market.

With the increasing requirements of carbon emission data monitoring, the company is expected to open up the growth space by virtue of the deep accumulation in the field of carbon monitoring.

In 2022, China issued a number of policies in the field of carbon monitoring, which focused on the quality control of carbon emission data and the improvement of technical norms, while carbon monitoring was difficult because of the small interannual variation of monitoring objects, complex forms of greenhouse gas emissions and the need to monitor the total amount rather than whether it exceeded the standard or not. Making use of the technical accumulation and on-site practical experience in the field of environmental monitoring for many years, and on the basis of the existing pollution source monitoring technology, the company has increased the metrological characteristics of products to meet the monitoring of greenhouse gas emissions. a variety of greenhouse gas online and portable products such as non-dispersive infrared spectroscopy, Fourier infrared spectroscopy and chromatography have been developed. In addition, the company's main customer groups cover power, iron and steel, petrochemical and other fields, are the main body of the carbon emissions and carbon trading market, sufficient customer base reserves will help the company to develop carbon emission monitoring business. As the restart of CCER is expected to accelerate, we believe that the company's carbon emissions monitoring business is expected to usher in industry development opportunities.

The acquisition of overseas high-quality assets to enter high-end equipment, operation and maintenance network to improve the layout of the country. The company acquired ORTHODYNE S.An of Belgium in 2016. Orthodyne mainly produces industrial chromatograph and analysis system, continuous analyzer and industrial gas detector. It has a wide range of customers in Europe and China, covering industrial gas, metallurgy, aerospace, electronics and laboratory fields. At present, the company's industrial process analysis business application solutions cover petrochemical, air separation, hydrogen energy, semiconductors and other fields. Relying on the technical precipitation of Orthodyne for many years, the company is expected to further open up the growth space in the field of industrial process analysis. In addition, in 2015, the company acquired KORE, a British company with deep mass spectrometer research and development genes. KORE is one of the first professional technology companies in the world to specialize in the research, development, production and sales of time-of-flight mass spectrometers and related products. The main customers are universities and research institutes around the world, used in all kinds of VOCs and other related scientific research fields. After the acquisition of KORE, the company is expected to make deep use of its mass spectrometry technology foundation, combined with the domestic market, to help the company expand more high-end segments. In terms of operation and maintenance, the company is one of the earliest enterprises in the industry to carry out third-party operation and maintenance services, and more than 120 technical service centers have been set up nationwide by 2022. The perfect operation and maintenance network helps the company to respond quickly and enhance customer stickiness and operation and maintenance quality.

Investment suggestion and valuation: as the leader in the field of eco-environmental monitoring instruments, the company has a deep accumulation in the industry, and the product system is constantly enriched and upgraded, and is expected to achieve considerable growth by taking advantage of the "double carbon" wind. We estimate that the company's sales revenue from 2023 to 2025 will be 2.389 billion yuan, an increase of 16.3%, 17.7% and 16.0% over the same period last year.

The net profit of returning to the mother was 305, 406, 471 million yuan, an increase of 7.7%, 33% and 16% over the same period last year. Cover for the first time, give "overweight" investment rating.

Risk hints: market competition aggravates risks, policy promotion falls short of expected risks, technology and brain drain risks, and R & D projects fall short of expected risks.