Introduction to this report:
The company is a comprehensive environmental service provider that started with the treatment of difficult wastewater. Technology+experience+service capabilities throughout the industry chain collaborate, and the project development capacity exceeds expectations.
Key points of investment:
It was covered for the first time, and a “increase in holdings” rating was given. We forecast the company's net profit for 2023-2025 to be 298 million yuan, 4.14 million yuan, and 497 million yuan respectively, corresponding to EPS of 0.71, 0.98, and 1.18 yuan, respectively. The company has entered a period of rapid order expansion. Technology+experience+service capabilities throughout the industry chain made the company stand out for its core competitiveness. The project development capability exceeded expectations, giving the company a target price of 15.14 yuan and 32% room for improvement.
A rapidly developing water environment treatment and solid waste disposal leader. 1) The company started with landfill leachate treatment and has now developed into a comprehensive environmental service provider for comprehensive water environment treatment and solid waste disposal. 2) The company mainly provides customers with integrated solutions for water and solid waste process design, equipment processing, equipment integration, engineering construction and operation services. 3) The rapid development of the environmental engineering business after listing drove high performance growth.
Technology+experience+service capabilities of the whole industry chain collaborated, and the company's project development capabilities exceeded expectations. 1) At present, the development of China's water environment and solid waste treatment industry has entered a mature period. The new demand for water environment treatment mainly comes from the repair of shortcomings in cities and the construction of basic water treatment facilities in townships, and the incremental demand for waste incineration also mainly comes from the declining market. It is difficult to obtain high-quality projects in declining markets at the county and township levels, which place high demands on the core competitiveness of enterprises. 2) The company has a number of industry-leading core treatment technology systems; has been deeply involved in the environmental management industry for more than ten years, has accumulated a large number of large-scale project experience throughout the country, and is rich in government and customer resources; and the company's investment, construction, operation and equipment service capabilities throughout the industry chain are first-class.
Relying on deep accumulation, the company entered a period of rapid order expansion after listing, and its project development capacity exceeded expectations.
Currently, the company has more than 5 billion yuan in orders, laying a solid foundation for future performance growth.
The new energy business is looking forward to a breakthrough. Recently, the company participated in a joint venture to establish the Guangzhou Tianyuanxing to Private New Energy Industry Partnership Fund. It will actively cooperate using existing sewage operating assets and government and customer resource advantages to explore fields such as distributed scenery and hydrogen energy, and focus on the company's progress in the new energy business.
Risk warning: project progress is lower than expected, business development is lower than expected, industry policy changes, etc.