Key investment points:
Market review: as of April 15, 2022, Shenwan environmental protection industry fell by 5.20% in the week, 4.20 percentage points lower than Shanghai and Shenzhen 300 index, ranking 26th among Shenwan 31 industries; Shenwan environmental protection sector fell 6.77% in the same month, underperforming the Shanghai and Shenzhen 300 index by 5.97 percentage points, ranking 25th among Shenwan 31 industries; Shenwan environmental protection sector has fallen 18.43% year to date, 3.22 percentage points lower than the Shanghai and Shenzhen 300 index, ranking 21st among Shenwan 31 industries.
As of April 15, 2022, the sub boards of the environmental protection industry of Shenwan fell in that week, of which the atmospheric governance sector fell by 1.16%, the comprehensive environmental governance sector fell by 1.34%, the water and water governance sector fell by 2.31%, the solid waste treatment sector fell by 3.49% and the environmental protection equipment sector fell by 6.54%.
Among the top ten stocks that rose in the week, Tongxing Environmental Protection Technology Co.Ltd(003027) , Haitian Water Group Co.Ltd(603759) and Guangxi Nanning Waterworks Co.Ltd(601368) ranked among the top three in Shenwan environmental protection sector, up 24.64%, 2.21% and 2.12% respectively. Among the top ten stocks that fell in the week, Jingjin Environmental Protection Co.Ltd(603279) , Jiangsu Jiuwu Hi-Tech Co.Ltd(300631) and Wuhan Xianglong Power Industry Co.Ltd(600769) fell significantly, with declines of 15.78%, 14.15% and 13.62% respectively.
In terms of Valuation: as of April 15, 2022, the PE (TTM) of environmental protection sector was 18.66 times; In terms of sub sectors, the PE (TTM) of atmospheric governance sector is 31.73 times, the PE (TTM) of water affairs and water governance sector is 17.85 times, the PE (TTM) of solid waste governance sector is 14.47 times, the PE (TTM) of comprehensive environmental governance sector is 40.54 times, and the PE (TTM) of environmental protection equipment sector is 22.18 times.
Important news: (1) on April 11, the national development and Reform Commission issued the implementation opinions on accelerating the recycling of waste textiles. The recycling of waste textiles is an important part of establishing and improving a green and low-carbon circular development economic system. (2) On April 12, the work safety committee of the State Council issued the national work safety plan for the 14th five year plan, requiring the improvement of supporting policies and measures such as the shutdown and transfer of hazardous chemical production enterprises in urban areas, returning from cities to parks and so on. (3) On April 14, the Ministry of housing and urban rural development (MOHURD) issued the implementation plan for deepening the battle of tackling urban black and smelly water bodies. The plan proposed that by 2025, the proportion of black and smelly water bodies in the built-up areas of county-level cities would reach 90%, and Beijing Tianjin Hebei, Yangtze River Delta and Pearl River Delta would strive to complete it one year ahead of schedule.
Zhou viewpoint of the environmental protection industry: Recently, the work safety committee of the State Council issued the national work safety plan for the 14th five year plan, requiring the timely revision of the national list of hazardous wastes, the revision of standards for identification, storage and pollution control of collaborative disposal of hazardous wastes in cement kilns, the formulation and improvement of the list of key supervision units of hazardous wastes, and the formation of a supervision system covering the whole process of generation, collection, storage, transfer, transportation, utilization and disposal of hazardous wastes. It is estimated that during the “14th five year plan” period, the supervision of hazardous waste will become stricter and the demand for hazardous waste disposal of hazardous waste generating enterprises is expected to increase. It is suggested to pay attention to the hazardous waste disposal enterprises Zhefu Holding Group Co.Ltd(002266) ( Zhefu Holding Group Co.Ltd(002266) ), Beijing Geoenviron Engineering & Technology Inc(603588) ( Beijing Geoenviron Engineering & Technology Inc(603588) ), Dongjiang Environmental Company Limited(002672) ( Dongjiang Environmental Company Limited(002672) ).
Risk warning: policy promotion is not as expected; Economic development is less than expected; The construction progress of the project is less than expected; Product price fluctuation risk, etc.
