Main points of investment
Biogas power generation leading enterprises, the compound growth rate of return net profit from 2017 to 2020 is 24%. The company is China's largest biogas power generation investment operator. Chen Gonghai and Li Na, the real controllers, hold 41.22% of the shares, while the employee shares 1.66% to inspire the team's vitality. From 2016 to 2020, the compound growth rate of revenue / return net profit is as high as 31.08%, 24.18%, and the gross profit margin / net profit rate is stable at 45%. 25%.
Landfill gas power generation has a significant emission reduction effect, and carbon trading increases the profit by 102% to 339%. After the launch of the national carbon market, the demand for CCER is released, and short-term scarcity prices are bullish. The kilowatt-hour electricity of landfill gas is reduced by 0.00578tCO2, 30max, 60max, 100 yuan, under the carbon price of 100 yuan, the kilowatt-hour electricity is increased by 0.17, 0.35, 0.58 yuan, and the profit end elasticity is 101.77%, 203.54%, 339.23%. The company has a mature carbon asset development team, benefiting from the greatest flexibility in carbon trading. Under the scenario of CCER carbon price 30 Universe, compared with the 2020 results, the theoretical elasticity of CCER to the net profit side is 102.70%, 205.40% and 342.34%.
The utilization permeability of landfill gas is less than 12%. There is much room for improvement, and organic waste disposal creates a blue ocean market for biogas utilization. The main results are as follows: 1) landfill and incineration are parallel for a long time, and landfill gas in the county town needs to be developed. At the end of 2019, the proportion of city / county landfill capacity accounting for harmless was 42.19% and 71.46%, and there were 1233 county-level landfills, accounting for 65% of the country. The average treatment scale of county-level landfills is 143 tons / day, which is lower than the urban average of 563 tons / day, and the development rate of landfill gas in county is low. 2) the power generation permeability of landfill gas is only 12%, which has a lot of room for improvement. In 2019, 216 biogas power generation projects were installed and connected to the grid, and the number of landfills permeability was less than 12%. 3) Policy encouragement-driven by emission reduction, 50 times the installed capacity of biogas power generation in China in ten years. The policy supports the construction of biogas power generation projects, and the price of power generation implements a subsidy system. The global methane emission reduction plan will reduce methane emissions by 45% by 2030. From 2016 to 2020, the installed capacity of biogas connected to the grid grew at a compound growth rate of 26.28%. The blue ocean market for biogas utilization was opened up in the fields of kitchen waste, aquaculture manure, agricultural straw, and industrial organic waste. For Europe, 1) Power generation energy structure: in 2018, the proportion of biogas power generation in Europe is 1.17%. In 2020, China is only 0.03%. In 2030, China is expected to reach 1%, and biogas power generation capacity is expected to reach 1% in 2030, 45MW, 51 times that in 2020. 2) Biogas utilization structure: biogas power generation in Europe accounts for 43% in 2018, while China is currently only 3.5%. China is expected to reach 20% in 2030, and biogas power generation capacity is expected to reach 20% in 2030, 44 times that of 2020.
Leading scale effect-Technical experience can reduce cost and increase efficiency, and has the profitability of small and medium-sized projects. 1) scale effect: 82 projects were put into operation at the end of 2020, and the installed capacity of the network is 171.25MW, with a market share of 20%. The accumulation of projects brings the scale effect of equipment sharing; 2) Technology leadership: it has 37 patents with the core of improving landfill gas collection efficiency and unit power generation efficiency, and the investment per ton is lower than that of the same industry, and the gas collection rate and power generation efficiency are high. 3) strong profitability: the gross profit margin of the company's landfill gas power generation business in 2019 is 48.62%, which is higher than the industry average 10.05pct. Small and medium-sized projects save profit space, suitable for the future development direction of the industry. Items with daily garbage inflow of less than 500t and less than 150t per day account for 74% and 7% respectively. 4) Internal and external expansion to assist capacity expansion: the newly expanded installed capacity will reach 57.31MW, with 33.49% incremental space compared with the end of 2020, and the acquisition of Veolia Xi'an, Beijing and Nanjing projects in first-tier cities, while horizontal expansion to restaurants and rural biogas.
Profit forecast and investment rating: we estimate that the return net profit of the company from 2021 to 2023 is RMB 160 million, an increase of 27.83% over the same period last year, with an increase of 46.62%, 28.99% and 1.88 yuan, respectively. Corresponding to the 46-31-24 times the price of PE,CCER, the theoretical profit elasticity is expected to reach 95% and 33%, respectively. Cover for the first time, giving a "buy" rating.
Risk hints: insufficient landfill gas, changes in subsidy policies, and intensified market competition
