LK(600388) 东吴证券·2024-10-21 09:30Investment Rating - The report maintains a "Buy" rating for Longking Environmental (龙净环保) [1][3] Core Views - In the first three quarters of 2024, the company achieved operating revenue of 6.654 billion yuan, a year-on-year decrease of 11.64%, while the net profit attributable to shareholders was 647 million yuan, a year-on-year increase of 0.91%. The net profit excluding non-recurring items was 585 million yuan, reflecting an 18.23% year-on-year growth [2] - The company's gross profit margin and net profit margin for the first three quarters of 2024 were 24.35% and 9.75%, respectively, indicating an increase of 0.68 percentage points and 1.25 percentage points year-on-year, showcasing improved profitability [2] - New signed contracts for environmental engineering projects totaled 7.544 billion yuan in the first three quarters of 2024, with a backlog of 19.213 billion yuan as of September 30, 2024, indicating stable order intake and a healthy order book [2] - The company reported a significant improvement in cash flow, with net cash flow from operating activities reaching 1.164 billion yuan, a year-on-year increase of 101.17% [2] - The green electricity projects are entering an accelerated construction and operation phase, with several projects expected to generate power in 2024, contributing to the company's growth [3] Financial Summary - The company forecasts net profit attributable to shareholders of 1.151 billion yuan, 1.478 billion yuan, and 2.027 billion yuan for 2024, 2025, and 2026, respectively, representing year-on-year growth rates of 126%, 28%, and 37% [3] - The projected P/E ratios for 2024, 2025, and 2026 are 12, 10, and 7 times, respectively, indicating an attractive valuation [3] - As of the end of June 2024, the company's asset-liability ratio was 68.90%, and the interest-bearing debt ratio was 23.60%, reflecting a solid financial position [2][5]