GF SECURITIES·2026-01-25 11:04Investment Rating - The report recommends a "Buy" rating for several companies in the environmental sector, including Lianmei Holdings, Shanggou Environmental, Longkun Technology, Weiming Environmental, Hanlan Environment, Dadi Ocean, Shanghai Industrial Holdings, and Conch Venture [1]. Core Insights - The transition from "energy consumption dual control" to "carbon emission dual control" is emphasized, with a focus on circular reduction and green energy industries. The year 2026 marks the first year of full transition to carbon emission dual control, with significant efforts expected in carbon reduction [1][11]. - The report highlights the impact of the EU carbon tariff, which will officially be implemented on January 1, 2026, significantly increasing the cost of exports from China to the EU. Current carbon prices in the EU are around 80-90 euros per ton, compared to approximately 81 yuan per ton in China [1][16]. - Companies involved in the circular economy, such as those in recycling and green energy, are recommended for investment due to their potential to reduce carbon emissions and adapt to new regulations [1][17]. Summary by Sections Section 1: Carbon Emission Dual Control Implementation - The "14th Five-Year Plan" shifts focus to carbon emission control, emphasizing the need for a new energy system and the integration of carbon reduction, pollution reduction, and green growth [11][12]. Section 2: Fund Holdings in Environmental Stocks - As of Q4 2025, the fund allocation for environmental stocks is only 0.23%, a decrease of 0.13 percentage points year-on-year, indicating a recovery trend since the lows of 2020 [21][26]. Section 3: Biodiesel Market Insights - The price of UCO (Used Cooking Oil), a key raw material for biodiesel, has increased by 7.6% to $1,060 per ton, while SAF (Sustainable Aviation Fuel) prices have decreased slightly but remain high at $2,150 per ton [31][35]. Section 4: Policy and Event Tracking in the Dual Carbon Field - Recent policies emphasize the construction of zero-carbon factories and the promotion of green development, with specific targets set for various industries by 2030 [39][40]. Section 5: Key Company Valuations and Financial Analysis - The report provides detailed financial metrics for key companies, including earnings per share (EPS), price-to-earnings (PE) ratios, and return on equity (ROE), indicating a generally positive outlook for the sector [4].