Hanlan Environment (600323): Deducting non-performance growth of 25 per year.

8% solid waste business performed well

Hanlan Environment (600323): Deducting non-performance growth of 25 per year.

8% solid waste business performed well

Core point of view: The company’s 2019 interim report deducts non-performance growth for ten years.

8%, exceeding market 成都桑拿网 expectations. The company disclosed its 2019 interim report, and the company achieved revenue of 26 in the first half of the year.

700 million (+16.

6%, the same below), deducting non-attributed net profit4.

470,000 yuan (+25.

8%, in the same period in 2018, the company’s non-recurring income was mainly due to the disposal of official kiln).

The increase in performance in the reporting period was mainly due to the commissioning of new solid waste projects (since 2018, new projects in Dalian, Langfang, Shunde, etc.) have been put into operation. The amount of incineration of in-service projects and the amount of kitchen waste disposal have continued to rise.The project was caused by factors such as budget operation during the year.

Revenue from solid waste business increased by 37% per year. The South China Sea model is based on the layout of the solid waste integration and transformation base. The solid waste business achieved revenue in the first half of the year.

9.8 billion (+37.

01.
) The outstanding performance was mainly due to the increase in processing capacity and the addition of new production capacity; the gas business benefited from the growth of revenue growth of new users.

2%, benefit from drainage business Sewage plant price increase revenue increased 37 per year.

4%.

According to the announcement statistics, the company’s current waste incineration capacity reaches 1.

13 announcements / day, under construction and preliminary super 1.
.

2 The lowest exchange rate / day; according to the Interim Report, 1,000 tons / day of southern Zhangzhou has been commissioned in 2019, and the 1500 tons / day of the third phase of the South China Sea will be completed by the end of September.

Under the background of waste classification, the company is expected to develop towards front-end waste classification and collection and operation, explore corresponding businesses in existing project locations, and achieve synergy and collaboration.

Jiangxi Hazardous Waste has been put into operation this year, and Foshan Hazardous Waste is expected to be completed at the end. Adding momentum to solid waste growth According to the company’s mid-term report and rating report, Jiangxi Ganzhou Hazardous Waste Project is operating in 2019, and the project has a disposal scale of 7.

2Each year’s budget covers 172 hazardous wastes in 36 categories, as of 2019.

Nearly 60 million yuan has been signed in March.

In addition, the Foshan Green Industrial Service Center Project (Nanhai) is expected to be completed by the end of this year, with a corresponding disposal scale of 9.

3 every year.

The successful release of SDIC Power as a war investment, the proposed issuance of convertible bonds to accelerate the construction of the project, maintaining the “buy” rating is expected to the company’s EPS in 2019-2021 respectively.

22, 1.

45 and 1.

70 yuan / share, the corresponding PE at the latest closing price is 13 respectively.

8, 11.

6,9.

9 times.

The company’s location advantage is obvious, the multi-business layout enhances the certainty of growth, and the non-performing performance maintains about 20% growth. We give 17 times PE conversion in 2019, corresponding to 20.

The fair value of 66 yuan / share. The company successfully dated SDIC Power as the three shareholders. It plans to issue convertible bonds for investment in solid waste projects and maintain a “buy” rating.

Risks indicate that the construction progress of the water plant is higher than expected, and the construction progress of the solid waste project is not up to expectations; the return on assets of new construction projects is falling; the downstream demand for gas is not up to expectations; the purchase price of gas has increased significantly.