XREC(SZ:000598) Xinda Securities·2024-10-24 23:30Investment Rating - The investment rating for Xingrong Environment (000598.SZ) is "Buy" [1][2] Core Views - The company achieved operating revenue of 6.213 billion yuan in the first three quarters of 2024, representing a year-on-year increase of 9.17% [1] - The net profit attributable to shareholders reached 1.626 billion yuan, also up 9.14% year-on-year [1] - The net profit margin for the first three quarters was 26.87%, showing a slight increase compared to the previous half-year [1] - The company is expected to maintain stable growth and dividend potential, with projected revenues of 9.14 billion, 9.61 billion, and 10.45 billion yuan for 2024, 2025, and 2026 respectively [2] Financial Performance Summary - In Q3 2024, the company reported revenue of 2.205 billion yuan, a year-on-year decrease of 0.29% but a quarter-on-quarter increase of 1.97% [1] - The net profit for Q3 2024 was 698 million yuan, reflecting an 8.57% year-on-year increase and a significant 48.14% quarter-on-quarter increase [1] - The cash flow from operating activities for the first three quarters was 2.147 billion yuan, an increase of 18.5% year-on-year [1] Business Growth and Development - The company is focusing on both organic and external growth in its water business, with ongoing projects expected to contribute to future performance [1] - The company has plans to invest in new water treatment facilities, which will enhance its market presence in Chengdu [1] - The total capacity of the company's current, under-construction, and planned water supply and drainage projects exceeds 9 million tons per day [1] Earnings Forecast - The forecasted earnings for the company are stable, with expected net profits of 2.091 billion, 2.283 billion, and 2.477 billion yuan for 2024, 2025, and 2026 respectively [2] - The projected P/E ratios for the company are 10.78x, 9.87x, and 9.10x for the years 2024, 2025, and 2026 respectively, indicating a favorable valuation outlook [2]