China Tianying(000035) 申万宏源·2024-06-07 13:01Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [21][46]. Core Insights - The company is positioned to benefit from the rapid growth in demand for green methanol and ammonia due to accelerated decarbonization in the shipping industry, driven by policies from the IMO and the EU [15][4]. - The company has a strong order backlog, with over 7,900 MWh of green electricity and more than 1.62 million tons of green methanol signed [15][21]. - The company’s traditional waste incineration and environmental equipment business is recovering significantly after the sale of Urbaser, with a notable increase in net profit in Q1 2024 [20][63]. Financial Performance - The company’s revenue is projected to grow from 5,324 million yuan in 2023 to 11,816 million yuan by 2026, reflecting a compound annual growth rate (CAGR) of 47% [9][21]. - The net profit for 2024 is expected to reach 850 million yuan, with a year-on-year growth of 152% [21][44]. - The gross margin is anticipated to improve from 20% in 2022 to 36% by 2026 [9][21]. Business Segments - The waste incineration segment is expected to contribute significantly to the company's profitability, with the Vietnam project projected to generate a revenue of 500 yuan per ton [47][93]. - The green electricity segment is expected to start production in 2024, with an estimated capacity of 1.5 GW [24][21]. - The energy storage segment is also showing promise, with a 3.68 GWh order expected to be released following successful testing of the company's gravity storage project [42][79]. Market Position - The company has established a strong international presence, particularly in the waste management sector, and is leveraging its technology to enhance competitiveness [63][90]. - The company’s environmental services have a contract backlog exceeding 1.1 billion yuan, indicating robust demand for its services [68][20]. Future Outlook - The company is expected to achieve significant growth in green methanol production, with plans to reach 150,000 tons in 2025 and 600,000 tons in 2026 [47][21]. - The overall market for alternative fuel vessels is expanding rapidly, with 49.5% of global orders in hand being for alternative fuel vessels as of April 2024 [15][6].