\u3000\u30 Xuchang Ketop Testing Research Institute Co.Ltd(003008) 67 Shengyuan Environmental Protection Co.Ltd(300867) )
Event: Shengyuan Environmental Protection Co.Ltd(300867) released the annual report of 2021: the operating revenue in 2021 was 2.29 billion yuan, a year-on-year increase of 122.08%; The net profit attributable to the parent company was 472 million yuan, a year-on-year increase of 55.27%; After deducting non profits, the net profit attributable to the parent company was 413 million yuan, a year-on-year increase of 37.33%. Diluted EPS is 1.74 yuan / share and weighted roe is 15.78%.
The capacity of incineration power generation has been increased rapidly to ensure steady growth of future performance. In 2021, the company's new waste incineration power generation capacity was 4950 tons / day, with a year-on-year increase of 55.0%; The total amount of garbage received into the plant in the whole year was 4.8458 million tons, a year-on-year increase of 16.8%; The annual cumulative power generation was 1.661 billion kwh, a year-on-year increase of 31.1%; The on grid power consumption was 1.431 billion kwh, a year-on-year increase of 31.3%. According to the company's announcement, the company has 4 projects under construction, with a total processing capacity of 1800 tons / day; Four projects are planned, with a total processing capacity of 2500 tons / day. In the future, with the gradual operation of projects under construction and preparation, the company will be in the peak period of capacity climbing and volume of waste incineration operation business, and the relevant business income will grow steadily.
The capacity utilization rate of sewage treatment business may be improved and the profitability will remain stable. By the end of the 21st century, the company had invested and operated five domestic sewage treatment plants and one domestic waste leachate treatment station, all located in Fujian Province. In 2021, due to the inspection and maintenance of municipal pipe network, the company treated a total of 813977 million tons of domestic sewage, a decrease of 7.96% over the same period of last year. With the acceleration of the upgrading and transformation process of sewage operation, it is expected that the capacity utilization rate of the company's sewage treatment projects will be further improved in the next few years, but the change of sewage treatment price is small in the short term, and the profitability of the company's domestic sewage treatment business will remain stable.
The joint development of new energy business in the province with the Three Gorges is expected to open the second growth curve. In 2021, the company is building and operating six distributed photovoltaic projects with a total installed capacity of 4594.6 kW. Assuming that the average annual utilization hours is 1300 hours, the total annual power generation is expected to be about 5.973 million kwh. In January this year, the company announced that it had signed a cooperation agreement with the Three Gorges to jointly develop offshore wind power and photovoltaic power generation projects in Fujian Province. Relying on the support of the Three Gorges group, the company will give better play to its resource advantages and effectively achieve the goal of comprehensively cultivating new energy industry. It is expected that in the future, as the company's offshore wind power, photovoltaic power generation and other projects are gradually put into operation, the company will open the second growth curve, and its performance is expected to achieve further growth.
Investment suggestion: the company's waste incineration power generation business is in the peak period of capacity climbing and volume increasing with the gradual operation of projects under construction and preparation, and its revenue will grow steadily in the future; The sewage treatment business benefited from the improvement of capacity utilization brought by the upgrading and transformation, and its profitability remained stable. In addition, the company cooperated with the Three Gorges to carry out the construction of photovoltaic, offshore wind power and other projects, opening the second growth curve. It is estimated that the net profit attributable to the parent company in 2022, 2023 and 2024 will be 604 / 710 / 830 million yuan respectively, the corresponding EPS will be 2.22/2.61/3.05 yuan / share respectively, and the corresponding PE will be 11.03x/9.39x/8.03x respectively. There is still room for improvement in the current valuation of the company, and the "recommended" rating will be given for the first time.
Risk warning: the risk that the commissioning progress of waste incineration power generation project is less than expected; The risk that the progress of subsidy declaration is less than expected; The risk that the development progress of offshore wind power project is less than expected; Risks of policy changes; The risk of intensified industry competition.
