Main points of investment:
Maintain and increase holdings. The company's revenue of 2.34 billion yuan (+ 16%) and net profit of 380 million yuan (+ 5%) in 2020 were lower than expected, while the revenue of 2021Q1 was 520 million yuan (+ 27%) and the net profit was 100 million yuan (+ 26%). Taking into account the increase in debt and the pressure on profitability, the company's EPS for 2021-22 is 1.53 yuan 1.88 yuan (formerly 1.93 yuan 2.51 yuan). In 2023, the growth rate of EPS is 2.11 yuan. The target price is maintained at 24.7 yuan, and the target price corresponds to 16.2 pounds in 2021-23. 11.8 times the PE,.
The operating steady net profit has declined, and the operating cash flow is improving significantly. 1) the quarterly revenue growth rate of 20Q1-21Q1-4x33xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx 3) Annual gross profit margin 29% (+ 0.16pct) due to the increase in municipal landscape gross margin, net profit margin 16.8% (- 1.86pct) increased by 54 million yuan due to asset / credit impairment loss; 4) four rates 6.2% (- 0.44pct), management 3.1% (- 0.82pct) due to the impact of the epidemic 5) the net cash flow of operation is 23 million yuan (- 78 million yuan in the same period last year), the debt ratio is 55.4% (+ 5.7pct) due to the increase of withdrawal; 6) the newly signed order in 2020 is 1.89 billion yuan (- 72%), and the newly signed 2021Q1 is 480 million yuan (+ 72%).
Carbon neutralization catalyses ecological restoration and equity incentives boost confidence. 1) benefit from the goal of "carbon neutralization" ecological civilization construction, deepen the layout of the whole industry chain of ecological restoration and landscape construction by relying on the core technology; 2) take ecological restoration as the core, give full play to the brand / first-mover advantage, and increase the proportion of orders; actively layout water governance / forest park / carbon sequestration afforestation projects; 3) explore innovative cooperation models and build a national management network 4) in April, the first repurchase of 30 million yuan (0.51% of the total share capital) was completed for the employee stock ownership plan, and the growth rate of the performance target for 21-23 was not less than 22x38,58.7% (all based on 20-year return net profit).
Catalyst: acceleration of order landing, favorable policy, continued loose capital environment and other risks: sharp turn in monetary and fiscal policy, lower-than-expected carbon neutralization, etc.
