The company started as an ecological restoration and treatment service provider in East China. Its core technology and R&D capabilities promote the rapid development of the company's comprehensive business. The company was founded in 2001 and is headquartered in Wuxi, Jiangsu. With the support of core technology and R&D capabilities, the company has rapidly developed into a comprehensive and highly professional ecological restoration and treatment service provider integrating investment and operation, planning and consulting, design and development, and ecological environment management. It is one of the leading enterprises in the domestic ecological and environmental protection industry, and one of the few ecological and environmental protection enterprises with core technology and a professional R&D team.
The main business is growing strongly, broadening the company's safety margin. Ecological protection is the brightest star track in the infrastructure category in recent years. The amount of completed investment increased rapidly from 141.6 billion yuan in 2013 to 814.4 billion yuan in 2020. The seven-year compound growth rate reached 28%. The status of ecological protection valued by the country during the 14th Five-Year Plan period did not change, and there is still great potential for development. The number of new orders signed by the company resumed positive growth in 2021, laying the foundation for continued improvement in its main business performance. As the number one ecological and environmental protection enterprise in China, strong core competitiveness continues to protect the company.
Strategically lay out forestry carbon sinks to create a new round of growth poles. Carbon emissions trading is becoming increasingly active in the context of the dual carbon policy, and the CCER restart declaration is imminent. The current supply is only 50 million tons per year, and future demand is expected to reach 350 million tons to 400 million tons per year. Among them, forestry carbon sinks are one of CCER's important supply projects, and the economic cost is low. In 2021, the company decided to give full play to the company's accumulated advantages and experience in the ecological environment industry, move towards a new carbon sink race, cooperate with local governments to develop carbon sinks using the forest business model, and maximize the leverage of the company's resources. Furthermore, forestry carbon sink development is highly specialized. The company has now established a professional team for forestry carbon sinks to obtain a certain first-mover advantage.
Give the purchase rating, and the target price is 21.20 yuan. We expect the company's EPS to be 1.02/1.18/1.35 yuan in 2021-2023. Drawing on industry conditions, we gave the company a purchase rating 18 times that of PE in 2022, with a target market value of 9.456 billion yuan and a corresponding target price of 21.20 yuan.
Risk warning: The company's carbon sink business fell short of expectations; CCER did not restart as expected.