Further development of scientific instruments: Cedron launched two new products, the MODEL 600Ex explosion-proof industrial gas chromatograph and the MODEL 4030Ex explosion-proof laser gas analyzer. The two new products mark another breakthrough for Cedron in the field of industrial gas analysis.
Business development: extension from environmental monitoring to scientific instruments and industrial services. At the intersection of technology and industry, the company actively expands its business into the field of scientific instruments and industrial services with deep technological accumulation and excellent innovative spirit.
An inflection point in business has emerged, and the company is expected to return to the growth curve. The company is at an inflection point in business and is expected to return to the growth curve. (1) Environmental monitoring business: In terms of policy, “establishing a pricing mechanism for coal and electricity capacity” helps restore market demand; in terms of owners' ability to pay, “standardizing the implementation of the new government and social capital cooperation (PPP) mechanism” is an important investment and financing method. (2) Gas analyzer business: The restart of domestic CCER will drive related demand. (3) System transformation, operation and maintenance, and energy-saving engineering transformation business is an extension of environmental monitoring and gas analysis instrument business. As market demand for environmental monitoring business and gas analysis business shows a trend increase, the business of transformation operation and maintenance and energy saving engineering will also grow accordingly. (4) Industrial process analysis is a reflection of long-term commitment.
Based on R&D and innovation advantages in the field of gas analysis instruments, the company nurtures and develops the industrial process analysis business. This business segment is expected to grow along with the expansion of emerging industries and the substitution of domestic production.
(5) Improvement of business model: An asset-light business model with improved cash flow lays the foundation for the company's sustainable development.
Profit forecasting and investment advice. We expect the company's revenue for 2023-2025 to be 10.8/1.96 billion yuan, with year-on-year changes of -28.5%/36%/33.7%, respectively. Net profit attributable to mother was 1.9/2.5/300 million yuan, respectively. The company's 2023-2025 dynamic price-earnings ratio was 28.2/21/17.4 times, respectively.
The company's dividend ratio reached 4.93%, and the valuation is attractive. We give the company a “buy” investment rating.
Risk warning: The country formulates and adjusts environmental protection, energy saving and emission reduction policies and related laws and regulations; market competition exceeds expectations.