There are bright spots in the soil remediation business. BIPV may be the company's new growth engine, maintaining the "overweight" rating of 20FY and 21Q1, respectively, with revenue of 31.5% and 610 million, and yoy of-6.1% and + 1.3%, respectively, of which 21Q1 is 5.0% higher than 19Q1. The net profit of 20FY and 21Q1 is 1.82 and 46 million respectively, and yoy is-14.1% and + 7.8% respectively, of which 21Q1 is 14.2% higher than 19Q1. 20FY is obviously dragged down by the epidemic, soil remediation business has a bright spot, 21Q1 profitability has shown repair signals, looking forward to the follow-up continuity. Lead Lonji into the blue sea of BIPV, Lonji / Sente join hands to give full play to their respective advantages, BIPV may become another growth engine of the company, the growth prospect of the company is worth looking forward to. We expect to maintain the "overweight" rating with a net profit of 2.08 million for the year 21-23.

The impact of the 20FY epidemic is greater, soil remediation is the bright spot, 21Q1 profitability began to repair the 20FY epidemic has a greater impact on the company (the company is headquartered in Beijing, project travel and other 20H1 are more affected). From a business point of view, the income of 20FY metal enclosure project, sound barrier system and soil restoration is-10%,-63% and 894% respectively, while the proportion of main metal enclosure project income is reduced by 3.5pct to 85.9%. Metal enclosure project 20FY revenue is under pressure, but the newly signed still achieve steady growth, the amount of outstanding contracts is sufficient, it is expected that the subsequent growth rate will pick up. The breakthrough growth of soil remediation 20FY revenue shows that the customer acceptance of the company's industry-leading in-situ soil remediation technology has increased by 473%, and the company has joined hands with central enterprises, and the follow-up prospect is expected. The growth rate of 21Q1 revenue is still relatively slow, and we speculate that the recognition rhythm of project revenue is the main reason. The newly signed contract value of 20FY is 3.76 billion, an increase of 10.8%, and the outstanding contract value at the end of the period is 6.72 billion, which is about 2.1 times the income of 20FY. The order on hand is sufficient, and the income is supported.

The comprehensive gross profit margins of 20FY and 21Q1 companies are 18.2% and 19.8%, respectively, which are-0.6% and + 1.1pct respectively compared with the same period last year. From a business point of view, the gross profit margin of 20FY metal enclosure engineering / sound barrier system / soil remediation is 17.5% / 16.2% and24.9%, respectively, compared with the same period of last year-1.9/+2.1/+9.7pct. It is speculated that the gross profit margin of 21Q1's main metal enclosure project began to pick up. The comprehensive gross profit margin of 20FY Company is under pressure, mainly because there are more revenue recognition of the projects with lower gross profit margin that won the bid in the previous period, and the subsequent impact is weaker, so it is speculated that the gross profit margin of 21Q1 metal enclosure project has begun to pick up. The financial expense rate of 20FY increased more due to the existence of convertible bonds, and the impairment loss caused by the slow turnover of the two gold funds increased more, but the cost control was very effective, which led to the reduction of 20FY homing net interest rate by 0.5pct to 5.8%. The 21Q1 homing net profit rate also increased by 0.5pct to 7.6%, which is lower than the improvement in gross profit margin.

Lead Lonji into BIPV Blue Ocean, raise profit forecast, maintain "increase" rating 21Q1 Longji and company controllers reached an agreement to acquire a total of 27.25% of the company's shares at a large premium.

On April 23, the equity transfer was completed, and Lonji became the second largest shareholder of the company. Longji and the company have reached a deep binding of interests, and the two sides intend to cooperate to promote the market expansion of the BIPV field. BIPV has greater advantages than BAPV in terms of economy / reliability. Under the background of obvious economy of photovoltaic power generation, superimposed "carbon emission reduction"

With the help of policy constraints, BIPV may develop or enter the track of rapid growth, relying on the company's advantages in roof design / construction and maintenance and Longji's advantages in the field of photovoltaic, BIPV may become another growth engine of the company. Considering the prospect of BIPV, we raise the forecast of 22nd homing net profit to 280409 million (the previous value is 277332 million), the new 23-year homing net profit is estimated to be 626 million, and the 21-23 yoy is 53%, 46%, 53% respectively. Compared with comparable companies, the growth prospect of the company is better (we estimate that the company's 20-23 Cagr 50.5% vs is 27.9% higher than that of the company). The recognition is better than the comparable company to give a certain premium, giving the company's 22-year target PE30x, corresponding to the target price of 23.10 yuan, maintaining the "overweight" rating.

Risk hint: the newly signed order is lower than expected, the payback risk, and the effect of cooperation with Longji is worse than expected.