XREC(SZ:000598) Xin Lang Cai Jing·2025-04-19 00:30Core Viewpoint - The company reported positive growth in both operating revenue and net profit for 2024, with operating revenue reaching 9.049 billion and net profit at 1.996 billion, reflecting year-on-year increases of 12% and 8% respectively [2] Group 1: Financial Performance - The company achieved an operating revenue of 9.049 billion, with a year-on-year growth of 12% [2] - The net profit attributable to shareholders was 1.996 billion, representing an 8% increase year-on-year [2] - The company’s main business segments, including wastewater treatment, water supply, and waste incineration, showed strong profitability, with wastewater treatment revenue growing by 20% to 3.641 billion and a gross margin increase of 1.48 percentage points to 41.63% [2] - The net cash flow from operating activities increased by 8.61% year-on-year due to improved management of accounts receivable [2] Group 2: Business Expansion - The company is expanding its business scale, focusing on Chengdu while actively developing projects outside the province, with a total operational, under-construction, and planned capacity of approximately 9.3 million tons per day for water supply and drainage projects [3] - The company has secured over 50 water and environmental protection concession projects across nine provinces and regions, with concession periods typically ranging from 25 to 30 years [3] - In 2025, the company plans to operationalize several key projects in Chengdu, which are expected to enhance operational performance as capacity expands [3] Group 3: Market Outlook - The market outlook is promising, with government policies aimed at improving urban wastewater management and increasing treatment rates, such as the goal to eliminate direct discharge points by 2027 [4] - Chengdu's "14th Five-Year" water development plan emphasizes the integration of supply and drainage systems and the enhancement of water infrastructure [4] - The long-term trend of stable development in the water and environmental protection industry is expected to continue, supported by various policy initiatives that present growth opportunities for the company [4] Group 4: Profit Forecast - The company is projected to achieve operating revenues of 9.878 billion, 10.808 billion, and 11.851 billion for 2025-2027, with year-on-year growth rates of 9.17%, 9.41%, and 9.65% respectively [5] - The net profit attributable to shareholders is expected to reach 2.257 billion, 2.511 billion, and 2.800 billion for the same period, with growth rates of 13.06%, 11.28%, and 11.48% respectively [5] - Based on the closing price on April 17, 2025, the corresponding PE ratios are projected to be 9.43, 8.47, and 7.60, with EPS estimates of 0.76, 0.84, and 0.94 [5]