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.



上海医药 买入 -- 研报
新华保险 中性 -- 研报
新和成 持有 -- 研报
片仔癀 买入 -- 研报
上海银行 买入 12.30 研报
万里扬 买入 -- 研报
南方航空 持有 10.03 研报
联美控股 买入 12.54 研报
首旅酒店 持有 -- 研报
中青旅 持有 -- 研报
广州酒家 持有 -- 研报


上海医药 0.83 0.78 研报
新华保险 0.83 0.97 研报
新和成 1.80 1.59 研报
片仔癀 1.70 2.43 研报
顺网科技 0.60 0.66 研报
上海银行 0 0 研报
万里扬 0.89 0.29 研报
南方航空 0.66 0.36 研报
腾邦国际 0.79 0.59 研报
众信旅游 0 0 研报
中青旅 0.72 0.79 研报


五粮液 42 持有 买入
伊利股份 39 持有 买入
完美世界 35 持有 持有
保利地产 33 买入 买入
隆基股份 32 持有 买入
贵州茅台 30 买入 买入
泸州老窖 30 持有 持有
中国国旅 29 持有 持有
三一重工 28 持有 买入
广联达 28 持有 买入
比亚迪 28 持有 持有
上汽集团 27 买入 买入
瀚蓝环境 26 持有 买入
长城汽车 26 持有 中性
海天味业 26 持有 持有
亿纬锂能 26 持有 买入
中信证券 25 持有 持有


电子信息 513 86 252
汽车制造 411 42 225
电子器件 299 55 189
机械行业 278 57 128
生物制药 272 53 150
建筑建材 242 47 133
化工行业 235 56 109
金融行业 232 30 99
有色金属 206 41 53
酿酒行业 196 16 111
钢铁行业 190 32 89
家电行业 181 13 106
商业百货 178 36 92
酒店旅游 176 20 83
交通运输 168 32 69
房地产 162 26 104
电力行业 137 29 65