Road Environment(SH:688156) Soochow Securities·2025-04-20 10:23Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company has shown steady growth in sales of bio-fermented feed, with significant improvement in cash flow [1] - The revenue for 2024 is projected to be 2.78 billion yuan, a decrease of 20.92% year-on-year, while the net profit attributable to shareholders is expected to be -565.5 million yuan, a decline of 309.69% [7] - The company is focusing on expanding its bio-fermented feed business, which accounted for 78% of total revenue in 2024, while actively reducing its environmental engineering business [7] Financial Summary - Total revenue is forecasted to increase from 2.78 billion yuan in 2024 to 8.12 billion yuan in 2027, with a compound annual growth rate (CAGR) of 38.08% [1][8] - The net profit attributable to shareholders is expected to recover from -565.5 million yuan in 2024 to 740 million yuan in 2027, reflecting a significant turnaround [1][8] - The earnings per share (EPS) is projected to improve from -0.56 yuan in 2024 to 0.74 yuan in 2027 [1][8] Business Performance - The bio-fermented feed segment generated revenue of 2.17 billion yuan in 2024, representing a year-on-year increase of 10.19% [7] - The company plans to increase its production capacity for bio-fermented feed to 700,000 tons per year by the end of 2024, with 470,000 tons already operational [7] - The sales volume of bio-fermented feed is expected to reach 112,600 tons in 2024, a growth of 20.75% year-on-year [7] Cash Flow and Financial Health - The operating cash flow is projected to significantly increase to 53 million yuan in 2024, a rise of 379.41% [7] - The company has actively pursued the collection of historical receivables, recovering 49.53 million yuan from accounts aged over two years [7] - The total assets are expected to grow from 1.725 billion yuan in 2024 to 1.952 billion yuan in 2027 [8]