Main points of investment

This Friday (November 11), "Sainz", a listed company of Science and Technology Innovation Board, made an inquiry.

Sainz (688480): the company is a high-tech enterprise specializing in the prevention and control of heavy metal pollution, covering heavy metal acid, wastewater, waste residue treatment and resource utilization, environmental remediation, pharmaceutical and equipment production and sales and other fields. From 2019 to 2021, the company achieved operating income of 467 million yuan / 356 million yuan / 385 million yuan, YOY of 60.81%, 23.69%, 7.93%, and a compound annual growth rate of 9.82%. The net profit of homing was 36 million yuan / 46 million yuan / 45 million yuan, and the YOY was 242.44%, 27.41%, 2.95%, and 61.78%, respectively. During the latest reporting period, 2022Q3 achieved an operating income of 331 million yuan, an increase of 51.46% over the same period last year, and a net profit of 50 million yuan, an increase of 55.18% over the same period last year. According to the preliminary forecast, the company expects the net profit of 2022 to be 6400.00 to 68 million yuan, an increase of 43.40% to 52.37% compared with the same period last year.

Investment highlights: 1. The company is an early domestic enterprise involved in the prevention and control of heavy metal pollution, and its technical level has reached the leading level in the industry, which can effectively reduce costs and increase efficiency for downstream customers' hazardous waste treatment. At present, the stock market of heavy metal acid and wastewater treatment in the non-ferrous industry is still dominated by the traditional lime neutralization process, accounting for more than 90%. With the deepening of the government's attention to the problem of environmental pollution, the requirements of heavy metal emission limits are constantly raised, resulting in increasing environmental protection pressure on heavy metal pollution enterprises; under this background, the traditional treatment methods which are inefficient and easy to cause secondary pollution are difficult to meet the increasingly stringent environmental protection standards and the rapidly growing demand for environmental protection. The company always attaches importance to technology research and development, and overcomes the difficult problems in the non-ferrous metals industry, such as resource treatment of waste acid and harmless disposal of arsenic-containing waste, and provides a better solution for downstream customers to reduce cost and increase efficiency. On the one hand, the company attaches importance to the process control of the total amount of heavy metal pollutants, and some technologies can reduce the total amount of waste residue by more than 90% while meeting the discharge standard. On the other hand, through the new technology of waste acid resource treatment developed by the company, the company can realize the efficient enrichment and separation of high concentration heavy metal ions in a short time, and carry out the recovery and utilization of valuable metals, acids, water, inorganic salts and other resources, and turn waste into treasure. at the same time, this technology has no neutralization residue and can effectively avoid the risk of secondary pollution. 2. Relying on the highly integrated comprehensive solution for the prevention and control of heavy metal pollution, the company has successively formed a long-term and stable cooperative relationship with a number of large domestic non-ferrous metal groups. At present, there are plenty of orders on hand for the solution. It is expected to promote the sustainable development of the company's performance. The core business of the company's comprehensive solution for the prevention and control of heavy metal pollution covers technical scheme design, special equipment processing and manufacturing, environmental protection engineering construction integration, etc., according to different needs, the customer heavy metal pollution prevention project can be contracted in the whole process or in several stages; with the improvement of environmental protection requirements, the government and enterprises pay more attention to one-stop service, making more integrated comprehensive environmental protection enterprises have more room for development. Relying on its own advantages, the company has successively formed cooperation with Zijin Mining Group, Jiangxi Copper, Baiyin Nonferrous Metals, Minmetals Group and other leading enterprises with the top 10 market capitalization of non-ferrous metals. Among them, Jiang Copper Group is the largest copper production base in China, has the largest Dexing Copper Mine and several copper mines in China, and Zijin Mining Group is one of the large mining companies that control the reserves and output of metal resources in China's mining industry. Minmetals Group is the most internationalized metal mining enterprise group. The above-mentioned enterprises have annual revenue of more than 200 billion, good performance, and always ranked among the top five customers of the company during the reporting period, and the cooperative relationship with the company is relatively stable, so the company's performance is expected to be sustainable. As of August 31, 2022, the company has 66 orders for comprehensive solutions, about 352.9255 million yuan, and the current orders for solutions are relatively sufficient.

Comparison with listed companies in the same industry: according to the similarity of business, listed companies in environmental protection industries such as Jindalai, Sanda Film, Jinke Environment, Abreu and Yongqing Environmental Protection are selected as Sainz's comparable listed companies. From the above comparable companies, the average revenue in 2021 is 829 million yuan, PE-TTM (arithmetic average) is 30.76X, and sales gross profit margin is 37.04%. Comparatively speaking, the revenue scale and gross profit margin of the company are lower than those of comparable companies.

Risk hint: companies that have started the inquiry process still have the possibility of not being listed due to special reasons, the company content is mainly based on prospectuses and other public materials, and the selection of listed companies in the same industry is not accurate. Risk, content data selection may have interpretation deviation, specific listed company risk is displayed in the text content, and so on.