China Environmental:Environmental expert presentation takeaway

类别:投资策略 机构:德意志银行 研究员:Thomas Zhu,Michael Tong 日期:2018-01-18

We invited Mr. Xue Tao, Executive Director of the E20 Environmental IndustryResearch Institute, to make a presentation at the dbAccess China conference. Wesummarize the key takeaways.

    Impact from recent regulations on PPP.

    Both MoF’s policy paper #92 and the new regulations on asset management willaffect PPP projects financing. However he believes that most projects affected willbe environment renovation projects, rather than projects with end-user payments(i.e. projects with significant operations revenue). Some environment renovationprojects “signed-up” (under the definition of MoF) may not be able to obtain bankloans – in the case of Sichuan for example, only 30% of the signed-up projectshave obtained bank loans. If the project cannot be executed, the project companywill be fined (though the amount is unlikely to be significant). It is required inMoF’s policy paper #92 that part of the payments for construction should be doneafter evaluating project performance, and therefore actual receivables collectioncould take longer than previously expected.

    PPP project database cleanup.

    The cleanup of PPP project database is likely to be completed in March 2018. Xueexpects most projects taken out of the database to be projects not yet signedup, and he expects strict scrutiny for future projects to be included. For someprovinces, budgets for projects in the database have got close to the 10% limitof their financial budget.

    Comparison of different environmental projects.

    Waste to Energy. WTE is still the most popular project type in environmentalamong the companies. With the development of waste sorting, there will bemore treatment projects specifically for particular types of waste (e.g. projectsspecifically for kitchen waste). China is likely to have sufficient WTE capacitiesafter three years while most new project awards by then will be projects relatedto sludge treatment and kitchen waste treatment.

    Environmental sanitation. This is the second most popular project type amongthe companies. Sanitation companies generally seek IRR of ~12%. Expenditureon sanitation by the government should increase one year after another on higherenvironmental standards. Most sanitation projects are paid by district level fiscal budgets rather than at city level. The price of long-term projects is based onnegotiation, which rises if the government's requirements go up.

    Air pollution treatment. Large-scale projects in desulfurization and denitrificationhave mostly been completed. Projects now are mainly small-scale projects indesulfurization and denitrification, as well as projects in VOC, which are normallyalso small-scale.

    Hazardous Waste Treatment. The valuation in HWT M&A projects is complicatedas projects vary from one to another, and thus the profitability of M&A project isdifficult to forecast.



华泰证券 持有 -- 研报
东方证券 持有 -- 研报
中信证券 持有 -- 研报
东方财富 持有 -- 研报
兆易创新 买入 -- 研报
汇顶科技 买入 -- 研报
闻泰科技 持有 -- 研报
士兰微 持有 -- 研报
圣邦股份 买入 -- 研报
扬杰科技 持有 -- 研报
顺络电子 买入 -- 研报


中科曙光 0 0 研报
浪潮信息 0.15 0.46 研报
启明星辰 0.59 0.46 研报
苏州科达 0 0 研报
卫宁健康 0.89 0.67 研报
中新赛克 0 0 研报
创业慧康 0 0 研报
用友网络 0.66 0.68 研报
深信服 0 0 研报
石基信息 0.95 0.96 研报
新北洋 0.68 0.73 研报


中信证券 34 持有 持有
隆基股份 32 买入 持有
华泰证券 32 持有 持有
贵州茅台 30 持有 买入
伊利股份 30 持有 买入
万科A 30 买入 买入
格力电器 30 持有 买入
上汽集团 29 持有 买入
五粮液 29 持有 买入
通威股份 28 买入 持有
泸州老窖 28 持有 买入
三一重工 27 持有 买入
美的集团 27 持有 买入
中信证券 26 持有 持有
华能国际 24 持有 持有
中国国旅 24 持有 持有
当升科技 24 持有 持有


电子信息 552 79 277
汽车制造 498 37 285
金融行业 426 28 189
建筑建材 421 52 204
电子器件 393 55 222
钢铁行业 341 29 152
化工行业 338 61 100
生物制药 297 48 136
机械行业 290 40 105
房地产 271 31 192
家电行业 265 11 124
酿酒行业 249 15 108
煤炭行业 236 23 100
有色金属 230 48 75
服装鞋类 229 18 110
食品行业 194 23 66
酒店旅游 190 20 53