Green Power (601330) 2019 Interim Report Review-Performance Meets Expectations, New Projects Put Into Operation, Dragged Gross Margin

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Green Power (601330) 2019 Interim Report Review-Performance Meets Expectations, New Projects Put Into Operation, Dragged Gross Margin
H1 performance was in line with expectations.The revenue was mainly driven by the rapid growth of operating capacity, and the decline in comprehensive gross profit margin resulting from the commissioning of new projects.49 up to 53.55%.Maintaining 2019?EPS forecasts for 2021 are zero.38/0.58/0.80 yuan, maintain the “buy” rating on H shares and maintain the “hold” rating on A shares. H1 performance was in line with expectations.2019H1 company realized operating income7.95 ppm, an increase of 54 in ten years.06%; realized net profit attributable to mother 2.17 ppm, an increase of 20 in ten years.35%; converted to basic earnings per share of 0.19 yuan.H1 performance accounts for 49 of our long-term forecast.6%, in line with expectations. The expansion of production capacity continued, and the commissioning of new projects pushed the overall gross profit margin down slightly.The rapid increase in revenue was mainly driven by the rapid growth in operating capacity.Miyun, Shantou and other five projects have been connected to the grid to generate electricity, supplementing the production capacity of 5,100 tons / day; in the first half of the year, a total of 340 domestic waste was replaced, an increase of 59.47%.New commissioning projects have relatively low gross profit margins due to early commissioning and other reasons. At the same time, overhauls of projects in Taizhou have increased operating costs, leading to a decline in the company’s gross profit margin in the first half of the year.49 up to 53.55%, but still high.In terms of period expenses, the management expense ratio and financial expense ratio decreased by 1 respectively.65 and 1.53 units, highlighting efficient management and control.Driven by the contraction in the scale of projects under construction, the company’s over-scale significantly increased, and the asset-liability ratio increased.97 up to 73.66%. Ample project reserves help development.As of H1 2019, the company is operating 20 waste-to-energy projects with a cumulative operating throughput of 18,610 tons / day; 7 projects under construction, 14 projects under construction, and 7,850 tons / day of capacity under construction.It is at the forefront of the industry.In the first half of the year, four waste-to-energy projects were replenished, and ample project reserves supported the 夜来香体验网 company’s long-term performance growth.At present, the company’s asset-liability ratio is at a relatively high level within the industry, and the use of financial leverage has been sufficient, but according to the project progress, we expect 2019?The capital expenditure scale in 2021 will reach USD 2/20/2 billion. How the company balances growth and capital constraints in the future needs to be observed. Risk factors: the adjustment risk of government subsidy policies; the intensified market competition and the neighborhood effect; the project’s termination or progress is less than expected risk; the account receivable risk, etc. Investment suggestion: Considering that H1 performance is in line with expectations, we maintain 2019?EPS forecasts for 2021 are zero.38/0.58/0.80 yuan, currently expected to correspond to A shares P / E 34/22/16 times, corresponding to H shares P / E 9/6/4 times.Based on estimates of comparable companies and company history, H shares are given a 10x P / E target for 2019, corresponding to a target price of 4.14 Maintain, maintain “buy” rating on H shares and “hold” rating on A shares.