Core Insights - The article highlights the strategic leadership and significant growth of the environmental service company, Hanlan Environment, during the "14th Five-Year Plan" period, emphasizing its successful mergers and international expansion efforts [2][3][10]. Strategic Leadership - Hanlan Environment has established a mature and efficient management system for strategic formulation, execution, and adjustment, aiming to "recreate a Hanlan" through a "scale-first, capital-first" strategy [3][4]. - The company has identified the shift in the environmental industry towards operational excellence and resource integration, leading to a focus on mergers and acquisitions to enhance its market position [3][6]. Financial Performance - During the "14th Five-Year Plan," Hanlan Environment's revenue grew from approximately 7.5 billion to 11.89 billion, while its net profit increased from 1.02 billion to 1.625 billion [4][5]. - The company reported a total revenue of 11.89 billion in 2024, with a year-on-year revenue growth of -5.22% and a net profit growth of 16.39% [5]. Key Acquisition - The acquisition of Yuefeng Environmental, valued at over 10 billion, is noted as a milestone in the Chinese environmental industry, significantly expanding Hanlan's waste incineration capacity from 45,050 tons/day to 97,590 tons/day [6][7]. - This acquisition has enhanced the company's market share in key regions such as the Greater Bay Area and Yangtze River Delta, establishing it as the largest waste incineration enterprise in Guangdong and Fujian provinces [7][8]. International Expansion - Hanlan Environment has initiated its internationalization strategy, focusing on Southeast Asia, particularly Thailand, with a new waste incineration project in Bangkok [9][10]. - The company has formed strategic partnerships in Indonesia and Malaysia to expand its environmental services and technology collaboration, leveraging its experience from the Hong Kong market [9][10]. Social and Economic Impact - The practices of Hanlan Environment demonstrate that the environmental industry can yield both economic benefits and social value, contributing to sustainable development and high-quality growth in the sector [10].

Industry Rating - The report maintains an "Outperform" rating for the public utility sector [1] Core Insights - The data center industry in China is expected to reach a market size of 304.8 billion yuan and over 10 million standard racks by 2024, both achieving a year-on-year growth of over 20% [2][25] - The emergence of AI technologies, particularly large models, is driving significant demand for computing power, which is expected to enhance the growth of data centers [3][65] - The increasing electricity demand from data centers is projected to lead to a transformation towards greener computing solutions [4][111] Summary by Sections 1. Progress of China's Data Center Industry - The development of China's data center industry has evolved through four stages, with computing power becoming the driving force in the digital economy since 2020 [9][18] - The market is characterized by a significant regional distribution, with the "East Data West Computing" initiative promoting a balanced development across eight hubs and ten clusters [32][38] 2. AI's Impact on Data Center Demand - The launch of DeepSeek in January 2025 is expected to significantly increase the rack utilization rate in third-party data centers [3][79] - The average rack utilization rate in China was 56.4% by the end of 2023, indicating a mismatch between supply and demand [56] - The global demand for computing power is projected to grow at a rate exceeding 50% annually, with AI applications driving this growth [65][71] 3. Electricity Demand and Green Transformation - Data centers' electricity costs typically account for over 50% of their total operating costs, with some internet clients seeing this figure rise to 70-80% [95] - The International Energy Agency (IEA) predicts that global data center electricity consumption will double from 415 TWh in 2024 to approximately 945 TWh by 2030, with a compound annual growth rate of about 15% [101] - By 2030, China's data center electricity demand is expected to reach between 300 billion and 700 billion kWh, representing 2.3% to 5.3% of the total electricity consumption [108][109]

Investment Rating - The investment rating for the company is "Buy" (maintained) [5] Core Views - The company's performance aligns with expectations, demonstrating growth resilience. In H1 2025, the company achieved revenue of 5.76 billion yuan, a year-on-year decline of 1.05%, while net profit attributable to shareholders was 970 million yuan, a year-on-year increase of 9% [6] - The company announced an interim dividend of 0.25 yuan per share, totaling 204 million yuan, which accounts for 21.08% of the net profit attributable to shareholders for H1 2025 [6] - The integration of Yuefeng Environmental exceeded market expectations, contributing to profit growth despite a high base from the previous year. The company is actively expanding its heating services and optimizing financing costs, which is expected to sustain high growth in performance for the second half of the year [6][8] Summary by Sections Market Performance - Closing price as of April 4, 2025, was 26.26 yuan, with a yearly high/low of 28.18/18.47 yuan [3] Financial Data - Total market capitalization is 21,411.02 million yuan, with a debt-to-asset ratio of 72.46% and net asset value per share of 16.90 yuan [3] Earnings Forecast and Valuation - Projected revenues for 2025-2027 are 13.721 billion, 15.526 billion, and 15.632 billion yuan respectively, with corresponding net profits of 1.976 billion, 2.263 billion, and 2.358 billion yuan [7][8] - The current price-to-earnings ratio (P/E) is projected to be 11, 9, and 9 times for 2025-2027 [8]

Group 1 - The company held its second extraordinary general meeting of shareholders in 2025, with a focus on discussing the mid-year profit distribution plan [1][2] - The meeting was organized to allow shareholders to exercise their voting rights through both on-site and online methods, ensuring transparency and accountability [1][2] - The company reported a net profit attributable to shareholders of 966,864,123.87 yuan for the first half of 2025, with undistributed profits amounting to 1,841,107,059.47 yuan [3] Group 2 - The proposed profit distribution plan includes a cash dividend of 2.5 yuan per 10 shares, totaling 203,836,786.50 yuan, which represents 21.08% of the net profit for the first half of 2025 [3] - The total share capital as of June 30, 2025, was 815,347,146 shares, and the distribution plan is aligned with the company's profit distribution policy and shareholder return plan for 2024-2026 [3] - The board of directors has approved the profit distribution plan, stating it will not significantly impact the company's cash flow or long-term development [3]

二、 会议时间： 瀚蓝环境股份有限公司 2025 年第二次临时股东会会议资料 目 录 一、 2025 年第二次临时股东会议程 二、 2025 年第二次临时股东会会议规则 三、 2025 年中期利润分配预案 瀚蓝环境股份有限公司 2025 年第二次临时股东会 材料之一 2025 年第二次临时股东会议程 一、 会议地点：广东省佛山市南海区桂城街道融和路 23 号瀚蓝广场 10 楼大会议室 三、 会议议程 (一) 宣布会议开始，报告到会股东及股东授权代表人数和持有股份数，说明授权委 托情况，介绍到会人员 (二) 宣读《会议规则》 (三) 推荐监票人、计票人（其中两人应为股东代表），由律师、股东代表共同负责 计票、监票 （一）现场会议 1、召开时间：2025 年 9 月 11 日下午 15:00，其中 14:45-15:00，与会股东代表签到， 领取会议材料；15:00 会议开始。 2、会议主持人：董事长张厚祥先生 （二）网络投票 召开时间： 1、通过交易系统平台：2025 年 9 月 11 日 9:15-9:25，9:30-11:30 和 13:00-15:00； 2、通过互联网投票平台：2025 年 9 月 11 ...

Summary of Key Points Core Viewpoint The A-share environmental industry continues to face significant challenges with accounts receivable, which remains a major obstacle to its development, despite efforts to improve collection practices. Group 1: Accounts Receivable Overview - As of June 30, 2025, 115 listed environmental companies reported total accounts receivable of 156.26 billion, averaging approximately 1.3565 billion per company, which is consistent with the end of 2024 figures [1] - The total accounts receivable for 157 A-share environmental companies at the end of 2024 was 213.9 billion, with an average of 1.36 billion per company [1] - The company with the highest accounts receivable is BWS, amounting to 12.3789 billion, a slight decrease from 12.3995 billion in the previous reporting period [1] Group 2: Collection Efforts and Challenges - Since 2025, environmental companies have intensified their efforts to recover accounts receivable, with some taking legal action against large corporate or government clients [2] - Companies like Wande and Jindalai have implemented targeted collection policies and performance evaluation mechanisms to enhance cash recovery [2] - Despite these efforts, companies acknowledge that if the overall economic environment does not improve, there may be risks of bad debts or extended collection periods, adversely affecting operational funding and performance [2]

Core Viewpoint - The Chinese environmental protection industry is experiencing a dual scenario of policy benefits and market challenges in the first half of 2025, with the "dual carbon" goals driving green and low-carbon transformation while economic recovery brings cost pressures and intensified competition. Financial Performance - The company achieved operating revenue of 5.763 billion yuan, remaining stable compared to the same period last year, while net profit attributable to shareholders increased by 8.99% to 967 million yuan [1][3] - The solid waste treatment business generated revenue of 2.949 billion yuan, with the household waste incineration segment growing by 17.63% to 2.126 billion yuan [3][4] - EBITDA reached 2.225 billion yuan, with an EBITDA margin of 38.61%, indicating effective operational optimization [3] Operational Efficiency - The company reported a waste incineration power generation capacity utilization rate of approximately 115%, with effective boiler operating hours exceeding 4,100 hours [4] - The comprehensive plant electricity consumption rate was reduced to 12.64%, a decrease of 0.77 percentage points year-on-year, reflecting improved operational efficiency [5] Strategic Mergers and Acquisitions - The acquisition of Guangdong Feng Environmental Protection (粤丰环保) significantly enhanced the company's market position, with the total waste incineration capacity reaching 97,590 tons per day, ranking among the top three in China [7][9] - The merger is expected to create synergies in financial, human resources, and operational integration, aiming for a value amplification effect [7][9] Future Growth Opportunities - The company is exploring the integration of waste incineration power generation with artificial intelligence data centers (AIDC), aiming to reduce energy costs and improve efficiency [10][11] - The establishment of an AI joint research institute with a technology partner aims to enhance operational decision-making through data-driven insights [12]

Core Viewpoint - The Chinese environmental protection industry is experiencing a dual scenario of policy dividends and market challenges in the first half of 2025, driven by the "dual carbon" goals, leading to innovation opportunities in waste treatment, water management, and energy sectors, while also facing cost pressures and intensified competition [1] Group 1: Company Performance - Hanlan Environment reported stable revenue of 5.763 billion yuan, with a net profit of 967 million yuan, reflecting a year-on-year growth of 8.99% [1] - The company achieved a significant improvement in operational metrics, including capacity utilization and electricity generation, contributing to the positive profit growth despite stable revenue [1][4] - The solid waste treatment segment generated revenue of 2.949 billion yuan, with the household waste incineration business growing by 17.63% year-on-year [4][5] Group 2: Operational Efficiency - Hanlan Environment maintained high operational efficiency, with a waste incineration capacity utilization rate of approximately 115% and effective boiler operation hours exceeding 4,100 hours [5] - The company successfully reduced its comprehensive electricity consumption rate to 12.64%, indicating improved operational efficiency [5] - The implementation of cost reduction and efficiency enhancement measures has led to a notable increase in profitability across the industry chain [5][6] Group 3: Strategic Mergers and Acquisitions - The acquisition of Yuefeng Environmental has significantly enhanced Hanlan Environment's market position, with the total waste incineration capacity reaching 97,590 tons per day, ranking among the top three in the country [8] - The merger is expected to create synergies through the integration of financial, human resources, and operational functions, aiming for a value amplification effect [8][9] - The strategic location of the newly integrated projects in Guangdong province provides opportunities for expanding waste treatment and heating services [9] Group 4: Future Growth Narratives - Hanlan Environment is exploring the integration of green electricity and artificial intelligence (AI) in its operations, particularly in the context of data centers, to reduce energy costs and improve efficiency [11][12] - The company has initiated partnerships to develop a model that combines waste incineration power generation with AI-driven data management, enhancing operational decision-making [12] - The focus on green electricity and AI is expected to drive new growth avenues, aligning with national policies aimed at reducing energy consumption in data centers [11][12]

Investment Rating - The report maintains an "Accumulate" rating for the environmental protection industry [1] Core Views - The logic of improving solid waste quality and efficiency, along with cash flow enhancement, continues to be realized, while the construction of the national carbon market is strengthened and carbon constraints are tightening [1] - The report highlights the importance of cash flow improvements and dividend increases in the waste incineration sector, driven by reduced capital expenditures and enhanced operational efficiency [39] Summary by Sections Industry Trends - The environmental protection industry is experiencing a stable revenue growth, with the waste incineration sector's revenue reaching 23.2 billion yuan, a 1% increase year-on-year, and net profit of 5.1 billion yuan, an 8% increase year-on-year [10][13] - The report emphasizes the need for a market-oriented approach in water services, predicting significant cash flow improvements similar to those seen in the waste incineration sector [7] Policy Tracking - The central government has issued guidelines to strengthen the national carbon market, aiming for a more comprehensive coverage of industrial sectors and a robust carbon pricing mechanism by 2030 [35][36] - The report suggests that stricter carbon monitoring will increase demand for carbon monitoring equipment, benefiting companies like Snowy Dragon and Juguang Technology [38] Company Performance - **Huanlan Environment**: Achieved a net profit of 966 million yuan in H1 2025, a 28% increase year-on-year, with a significant contribution from its subsidiary [29] - **Green Power**: Reported a 24% increase in net profit in H1 2025, driven by increased waste incineration and operational efficiency [31] - **Haihua Entrepreneurship**: Experienced a 9.33% increase in net profit, with a focus on stable growth in waste disposal and energy generation [31] - **Yongxing Co.**: Increased its waste processing volume, leading to a 9% rise in net profit [32] Cash Flow and Dividends - The waste incineration sector is seeing a significant increase in free cash flow, with projections indicating potential dividend payouts reaching 50% to 150% in the coming years [40][41] - The report notes that companies are beginning to distribute dividends more actively, with Huanlan Environment initiating its first mid-year dividend [24][29]

Investment Rating - The report maintains a "Positive" investment rating for the environmental protection industry [11]. Core Insights - The environmental protection sector showed a slight increase in net profit, with a year-on-year growth of 1.32% in the first half of 2025, despite a slight decline in revenue [6][22]. - The performance of waste incineration and water services remains stable, while the overall growth of the sector is hindered by declines in air quality and recycling resources [6][22]. - The industry is transitioning towards a ToB model, which is expected to accelerate valuation recovery [9]. Summary by Sections Performance Overview - In H1 2025, the environmental protection sector achieved revenue of 142.1 billion yuan, a decrease of 0.20% year-on-year, and a net profit of 13.7 billion yuan, an increase of 1.32% [6][22]. - The gross profit margin improved to 28.7%, up by 0.30 percentage points year-on-year [6][22]. Income Statement - The sector's net profit growth is primarily driven by stable performance in waste incineration and water operations, while the recycling and air quality segments experienced declines [22][24]. - Waste incineration saw revenue growth of 1.81% and net profit growth of 9.31% in H1 2025 [23]. - Water operations reported a slight revenue decline of 1.38% but a net profit increase of 1.79% [30]. Balance Sheet - The environmental protection sector's debt ratio was 57.7%, showing a slight increase of 0.27 percentage points year-on-year [7]. - Accounts receivable and related assets continue to rise, indicating potential cash flow challenges [7]. Cash Flow Statement - The cash collection ratio improved to 93.5%, up by 3.9 percentage points year-on-year, with net cash flow from operating activities reaching 10.44 billion yuan, an increase of 13.8% [8]. - Investment activities showed a net expenditure of 27.4 billion yuan, primarily directed towards waste incineration and water operations [8]. Investment Strategy - The report recommends continued investment in waste incineration and water services, highlighting that the sector can support a price-to-earnings ratio of 14x-16x, while many quality stocks are currently trading at 10x-12x [9]. - The report suggests potential growth opportunities in various segments, including testing services and energy conservation [9].