Incident: The company plans to jointly build a hazardous waste incineration disposal project and waste catalyst treatment project in Tongnan County, Chongqing by cross-holding 45% and 55% of shares between its catalyst company and Chongqing Xinzhongtian Environmental Protection. Investment points: The company has entered the field of hazardous waste disposal through catalyst treatment, and the market space is large. Xinzhongtian Environmental Protection is a local hazardous waste treatment company in Chongqing. It has a complete hazardous waste disposal industry chain. It is the supporting unit of the National Environmental Hazardous Waste Disposal Engineering Technology (Chongqing) Center, and its holding subsidiary Zhongtian Electric Waste is subsidized by the WEEE Fund. The company had revenue of 248 million yuan in 2014 and a total profit of 45 million yuan. It has complementary advantages and capabilities with catalyst subsidiaries in hazardous waste treatment. Among the two projects of this cooperation: the centralized incineration project for hazardous waste, CLP Yuanda Catalyst Co., Ltd. plans to invest 22.5 million yuan, holding 45% of the shares and 55% of the shares of Zhongtian; the abandoned catalyst treatment project has a registered capital of 20 million yuan, which is still in the early stages. Yuanda plans to transfer 45% of the shares to Zhongtian in accordance with state-owned property transfer regulations. After that, Yuanda Catalysts will still hold 55% of the shares in the project. Yuanda has now entered the hazardous waste industry through catalyst treatment, which is in line with the development plan decided by the company at the beginning of the year, complements the company's entire life cycle chain of catalysts, and successfully opens up space for the company's development. The company's focus has changed from the business related to desulfurization and denitrification to the entire business of environmental protection platforms. The refinement of the power plant water treatment project and the implementation of Jiro's first power plant “Mizushima” demonstration project have doubled the company's integrated water service capacity. The company established Chongqing Yuanda Water Co., Ltd. The water treatment contract in Beipiao City reflects the rapid response of the company's new management to the strategic goals of water development, and the company can be expected to expand rapidly. Furthermore, in the future, the company is expected to use the advantages of platform resources to carry out catalyst recycling and disposal business and enter the field of hazardous waste treatment. The PPP agreement was successfully signed to promote pilot cooperation projects in the fields of water affairs and energy saving. The company announced on May 30 that it signed a PPP agreement for comprehensive energy management with Guixi City; on June 27, it signed a PPP agreement with Beipiao City for sewage treatment projects. The company fully seizes the opportunity for the country to promote the PPP model, promote pilot PPP models in the fields of water and energy saving in the Liaoning and Jiangxi regions, and expand the company's customer base and business space. In the future, we are optimistic that the company will “catch up” in this area. Build the first domestic listing platform for nuclear environmental protection. The company is one of only three domestic enterprises with medium and low emission nuclear waste treatment licenses, and is also the first company to undertake an off-stack nuclear waste treatment project for a nuclear power plant using the EP method. Relying on the implementation of the Shandong Haiyang Nuclear Power Plant SRTF project, the company is beginning to have full-process nuclear environmental protection service capabilities, and is expected to achieve performance growth in the field of nuclear waste treatment. Investment rating and valuation: Regardless of new businesses such as nuclear waste, hazardous waste, and carbon trading, we maintain the company's 15-17 revenue forecasts of 38.39, 42.03, and 4,515 billion yuan (3.484 billion yuan in 2014), and net profit of 4.14, 3.17, and 347 million yuan respectively. The corresponding fully diluted EPS is 0.69, 0.53, and 0.58 yuan/share, respectively. Considering that the company's water sector has begun to gain strength, the company has entered a golden period of development and maintained a “buy” rating.