Key investment points
Key recommendations focus on the following: ‘ Miracle Automation Engineering Co.Ltd(002009) for the , Grandblue Environment Co.Ltd(600323) , China water, Jiangxi Hongcheng Environment Co.Ltd(600461) , Yutong Heavy Industries Co.Ltd(600817) , Henan Bccy Environmental Energy Co.Ltd(300614) , fulongma, China Resourcesand Environment Co.Ltd(600217) . Suggestions for attention: Jiangxi Jovo Energy Co.Ltd(605090) , Suzhou Jinhong Gas Co.Ltd(688106) , Wangneng Environment Co.Ltd(002034) , Chongqing Sanfeng Environment Group Corp.Ltd(601827) , conch entrepreneurship, Beijing Capital Eco-Environment Protection Group Co.Ltd(600008)
Latest view: focus on sustainable growth renewable resources & marginal improvement of undervalued value: cash flow, high dividend, new track. 1) Sustainable growth renewable resources, key recommendations: reuse of power batteries [ Miracle Automation Engineering Co.Ltd(002009) ] pe15 times in 2022, continuous doubling of scale from 2020 to 2021, and three times of scale expansion from 2022 to 2024; Hazardous waste recycling [ Beijing Geoenviron Engineering & Technology Inc(603588) ] in 2022, it is considered to increase pe18 times, and increase by 30% from 2016 to 2021 + it will continue in the future, and the operating profit accounts for 60% +. 2) Undervalued value + marginal improvement, ① undervalued value + cash flow improvement: it is recommended that the leading countries in the [Everbright environment] industry make up about RMB 8.1 billion in arrears. The stock subsidy can be solved in time, superimposing their own development cycle, and the cash flow welcomes the improvement and value return; [ Dynagreen Environmental Protection Group Co.Ltd(601330) ] the arrears paid by the state account for 16% of the net assets at the end of 2021, and the asset structure has great flexibility to improve. ② Undervalued + High Dividend: it is recommended that [Everbright environment] pay a dividend of HK $0.34 in 2021, with a dividend rate of 7.04%; [ Jiangxi Hongcheng Environment Co.Ltd(600461) ] the dividend yield is 6.67%, and it is promised that the dividend proportion from 2021 to 2023 will be ≥ 50% to provide a margin of safety. ③ Underestimated value + new track: focus on recommending [ Fujian Longking Co.Ltd(600388) ] the improvement of the main business structure of the leader in atmospheric governance, and strategic cooperation Zijin Mining Group Company Limited(601899) cutting into new energy.
The general office of the Ministry of agriculture and rural areas and the comprehensive Department of the National Rural Revitalization Bureau jointly issued the guidelines for social capital investment in agriculture and rural areas (2022). Promote organic technology & biogas power generation: support social capital to participate in comprehensive utilization of straw, recycling of waste agricultural film, recycling and treatment of pesticide and fertilizer packaging waste, etc. Encourage social capital to invest in the development and utilization of rural renewable energy, increase investment in the comprehensive construction of rural energy, promote the utilization technology of rural renewable energy, and explore new modes of straw baled direct combustion and formed fuel heating, biogas and biogas biogas gas supply and heating. It is suggested to pay attention to: biogas power generation faucet [ Henan Bccy Environmental Energy Co.Ltd(300614) ]; Technical leader of organic matter and biogas equipment [ Welle Environmental Group Co.Ltd(300190) ].
Carbon neutral builds the investment framework of environmental protection industry from the front end, middle end and back end, and is bullish on the long-term rise of EU carbon price and CCER in the short term. 1) Front end energy substitution: adjust the energy structure and pay attention to the demand for environmental sanitation new energy equipment and renewable energy substitution. 2) Middle end energy conservation and emission reduction: promote industrial transformation and pay attention to energy conservation management & Application of emission reduction equipment. 3) Back end recycling: promote the recycling of renewable resources such as waste classification, waste household appliances / automobiles, and hazardous waste recycling. 4) Carbon trading: encourage the development of CCER projects such as renewable energy, methane utilization and forestry carbon sequestration. The development of China’s carbon market is similar to that of the European Union. It already has the prototype of total amount control & market regulation mechanism. At present, there is much room to improve the transaction scale and covering industries, and the carbon price is far lower than overseas. The tightening of total amount drives the carbon price to rise for a long time. The approval of CCER demand release is expected to restart. We expect the scarcity price of CCER to rise in the near future.
Steady growth + new tools + new fields, comprehensively recommend low-carbon environmental protection assets: 1) environmental asset value + Growth Logic 2.0: a) steady growth + new tools + new fields, from single dimension to combination. Policy +: double carbon macro policy, strengthening infrastructure investment; Mode +: REITs improves the return on assets and opens the growth ceiling; Space +: the second growth curve. B) The value of cash flow driven by marketization is further highlighted: policy tools such as CCER green power, waste incineration bidding and marketization of water price enhance the certainty of return and improve cash flow. 2) Under the new logic, the valuation anchor has been significantly improved: undervalued + low position + growth, improved model and cash flow, and improved valuation. 3) Suggestions: a) steady growth / high dividend / REITs: waste incineration [ Dynagreen Environmental Protection Group Co.Ltd(601330) ], water + pipe network [ Beijing Capital Eco-Environment Protection Group Co.Ltd(600008) ] [ Jiangxi Hongcheng Environment Co.Ltd(600461) ], water supply price increase + direct drinking water [China water]. B) New track: renewable resources: the most economical carbon premium + price increase of resource products: hazardous waste recycling [ Beijing Geoenviron Engineering & Technology Inc(603588) ], wine tank recycling [ Road Environment Technology Co.Ltd(688156) ], power battery recycling [ Miracle Automation Engineering Co.Ltd(002009) ], recycled plastics [ Shandong Intco Recycling Resources Co.Ltd(688087) ] [ Beijing Sanlian Hope Shin-Gosentechnical Service Co.Ltd(300384) ]; Hydrogen energy: [ Jiangxi Jovo Energy Co.Ltd(605090) ]; High matte: [ Zhejiang Weiming Environment Protection Co.Ltd(603568) ].
Latest research: Pony Testing International Group Co.Ltd(300887) 2021 annual report comments: the performance is slightly higher than expected, and the growth speed meets the opportunity Road Environment Technology Co.Ltd(688156) 2021 annual report & Comments on the first quarterly report of 22 years: the utilization of distiller’s grains and the improvement of cash flow Miracle Automation Engineering Co.Ltd(002009) : strategic cooperation with Xingheng power supply and re expansion of recycling channels.
Risk tip: the policy promotion is less than expected, the interest rate rises more than expected, and the fiscal expenditure is lower than expected
