Summary of Conference Call Records Industry or Company Involved - The discussion primarily revolves around the **data infrastructure** sector and **scientific instruments** industry, with specific mentions of companies like **蓝颜文绍**, **聚光科技**, **网易科技**, **蓝派科**, and **海南技术**. Core Points and Arguments 1. **Data Infrastructure Support**: The government is set to support the construction of foundational, technological, and long-term data infrastructure at the local level, which is expected to benefit companies like 蓝颜文绍 due to their advantages in stable green electricity and land use [1] 2. **Performance of the Paid Sector**: The paid sector has shown stable profitability, with significant improvements in cash flow and a reduction in accounts receivable for 哈拉环境, indicating a positive trend in financial health [1] 3. **Free Cash Flow Improvement**: The free cash flow for the sector is expected to turn positive significantly in 2024 compared to 2023, with 10 out of 12 companies in the sector increasing their absolute dividend amounts [1] 4. **Scientific Instruments Amid Trade Tensions**: In the context of ongoing US-China trade tensions, the focus should shift from short-term policy impacts to the long-term support for foundational industries like scientific instruments, where domestic companies are enhancing their R&D capabilities [2] 5. **Investment Opportunities in Environmental Companies**: There is a recommendation to focus on state-owned enterprises as key players in the market, particularly those with strong reform demands and significant performance declines, such as 创业环保, 武汉控股, and 中云环保 [2] Other Important but Overlooked Content - The mention of the improvement in cash flow and the reduction of accounts receivable is crucial as it indicates a healthier financial environment for the companies involved, which may lead to increased investor confidence [1] - The emphasis on long-term investment in scientific instruments suggests a strategic shift that could provide opportunities for growth despite current trade challenges [2]

Market Overview - The overall market is experiencing a struggle around the 3500-point mark, with the Shanghai Composite Index closing at 3500.62 points, down 0.12% [2] - The total market turnover for the morning session was 927 billion, showing a significant decrease compared to the previous day [3] Financial Sector Performance - The financial sector, particularly banks and insurance companies, is underperforming, with major banks seeing declines. For instance, Xinhua Insurance dropped by 2.69%, and other major insurers also fell by over 1% [5][6] - Among 42 bank stocks, only China Bank remained flat, while others, such as Xiamen Bank, saw declines of nearly 4% [7] New Energy Sector Highlights - N Huadian New Energy (N华新) had a strong debut on July 16, with its stock price reaching a peak increase of 219.81% during trading, closing at 7.38 yuan per share, a rise of 132.08% [10][11] - The company raised 18.171 billion yuan through its IPO, with plans to invest in various renewable energy projects [11] Hong Kong Market Activity - In the Hong Kong market, Weiyali (威雅利) resumed trading with a dramatic increase, reaching a peak of 918.4% during the session, closing at 11 HKD per share, up 237.42% [12][13] - The stock had been suspended since September 30, 2024, and the recent surge followed the completion of a subscription that increased public shareholding [13]

Investment Rating - The report maintains an "Accumulate" rating for the environmental protection industry [1]. Core Views - The report emphasizes the improvement in cash flow and dividend potential due to reduced capital expenditures in the waste management sector, alongside enhanced return on equity (ROE) through quality improvements in heating and IDC collaborations [1][11][15]. Summary by Sections Industry Trends - The environmental protection sector is experiencing a significant shift with a 9% increase in the sector's performance compared to the Shanghai and Shenzhen 300 indices [3]. - The report highlights a 73% increase in sales of new energy sanitation vehicles, with a penetration rate rising to 14.95% [25]. Key Recommendations - The report recommends several companies for investment, including Huaneng Environment, Green Power, and Yongxing Co., among others, due to their strong dividend potential and operational efficiency [5][11]. - It suggests focusing on companies like Yuehai Investment and Xingrong Environment for their robust cash flow and high dividend yields [17]. Policy Tracking - The Ministry of Ecology and Environment has issued a notice to enhance the quality of law enforcement, which is expected to improve operational efficiency and compliance in the industry [9][10]. - The report notes that the government is concentrating on environmental governance funding for 2025, which may positively impact the sector [7]. Financial Performance - The waste management sector is projected to see a significant increase in free cash flow, with dividends expected to rise as capital expenditures decrease [11][12]. - Specific companies are highlighted for their dividend growth, such as Junxin Co. with a 37% increase in cash dividends and Green Power with a 100% increase [12][13]. Market Dynamics - The report discusses the trend of garbage incineration and IDC collaborations as a new growth avenue, emphasizing the advantages of clean and efficient energy generation [14]. - The water utility sector is also highlighted for its stable growth and high dividends, with ongoing water price reforms expected to enhance profitability [15][17]. Sector Performance - The environmental protection and public utilities index rose by 2.69% during the week of July 7-11, 2025, outperforming the broader market indices [45].

Investment Rating - The report maintains a "Buy" rating for China State Construction Engineering Corporation (601668.SH) [1] Core Views - In a low interest rate environment, high dividend strategies continue to perform well, with leading construction companies like China State Construction offering attractive value [5] - As of July 11, 2025, China State Construction's dividend yield is approximately 4.47%, which is higher than the average yield of major banks at 3.88% [5][11] - The company has a price-to-book (PB) ratio of 0.54, indicating a significant undervaluation compared to historical levels [5] - The company has maintained a stable dividend policy, with a cumulative payout ratio of 20.1%, the highest among major state-owned construction enterprises [8] - The company’s new contract signing in the first five months of 2025 reached 1,841.2 billion yuan, showing a year-on-year growth of 1.7% [8] Summary by Sections Financial Performance - The projected net profit for 2025 is 47.49 billion yuan, with a steady growth forecast for the following years [10] - The company’s revenue for 2025 is estimated at 225.77 billion yuan, reflecting a growth rate of 3.23% [10] - The earnings per share (EPS) for 2025 is projected to be 1.15 yuan [10] Dividend Policy - China State Construction has a historical average dividend payout ratio of 20.3%, ensuring predictable returns for shareholders [8] - The company plans to maintain stable dividends in 2025, supporting its major shareholder, China State Construction Group, with consistent cash flow [8] Market Position - The construction industry is characterized by high concentration, with state-owned enterprises like China State Construction having strong bargaining power, which enhances asset safety [6] - The report highlights the ongoing government efforts to address debt issues, with significant allocations for debt resolution and project financing [7] Valuation Metrics - The report indicates that the company’s current valuation metrics, including a PB ratio of 0.54 and a PE ratio of 5, suggest it is undervalued relative to its earnings potential [10][18] - The dividend yield of 4.5% for 2024 is expected to increase to 4.8% by 2027, indicating a favorable return for investors [18]

1. Report Industry Investment Rating - No specific industry investment rating is provided in the report. 2. Core Viewpoints - **Stock Index**: The A-share market is expected to continue to fluctuate. The index fundamentals depend on the domestic economic recovery process. Although the corporate profit situation in the first half of 2025 has improved significantly compared to 2024, and there is support from allocation funds, the index is difficult to break through the central level and rise significantly due to credit contraction and insufficient demand under the background of debt resolution. On the other hand, it will not experience a sharp decline in the short term [1]. - **Treasury Bonds**: The bond market is in an environment with loose funds, stable economy, and low short-term interest rate cut expectations. With insufficient upward and downward momentum, it is expected to continue the fluctuating trend in the short term [2]. 3. Summary by Relevant Catalogs 3.1 Research Views - **Stock Index**: On July 9, 2025, the A-share market fluctuated and closed down. The Wind All A index fell 0.18% with a trading volume of 1.53 trillion yuan. The CSI 1000, CSI 500, SSE 50, and SSE 300 indices also declined. The media sector led the rise, while the non-ferrous metals sector corrected. The recent Central Financial and Economic Commission emphasized the construction of a unified national market, but the impact on related themes depends on the transfer mode and scale of central fiscal incremental policies. Overseas, the Fed's interest rate cut expectation has slowed down, and the boost to domestic small-cap indices has weakened. The fundamentals of the index depend on the domestic economic recovery process, and it is expected to fluctuate [1]. - **Treasury Bonds**: On July 9, 2025, treasury bond futures closed with gains. The central bank conducted 755 billion yuan of 7-day reverse repurchase operations with a stable interest rate of 1.4%. The net withdrawal of funds was 230 billion yuan. The overall capital situation was loose, and the price index remained stable. The bond market is expected to continue to fluctuate in the short term [1][2]. 3.2 Daily Price Changes - **Stock Index Futures**: On July 9, 2025, compared with the previous day, the IH, IF, IC, and IM contracts all declined, with declines of -0.14%, -0.15%, -0.47%, and -0.35% respectively [3]. - **Stock Indices**: The SSE 50, SSE 300, CSI 500, and CSI 1000 indices also declined, with declines of -0.26%, -0.18%, -0.41%, and -0.27% respectively [3]. - **Treasury Bond Futures**: The TS, TF, T, and TL contracts all rose, with increases of 0.00%, 0.02%, 0.03%, and 0.14% respectively [3]. 3.3 Market News - From 2021 to 2024, China's economy maintained an average annual growth rate of 5.5%. The average contribution rate of domestic demand to economic growth was 86.4%, and the average contribution rate of final consumption to economic growth reached 56.2%, 8.6 percentage points higher than that during the 13th Five-Year Plan period [4]. 3.4 Chart Analysis - **Stock Index Futures**: The report presents the trend charts of the main contracts and the basis of IH, IF, IC, and IM [6][7][9]. - **Treasury Bond Futures**: The report shows the trend charts of the main contracts, spot bond yields, basis, inter - period spreads, cross - variety spreads, and capital interest rates of treasury bond futures [13][15][17]. - **Exchange Rates**: The report provides the trend charts of the central parity rates of the US dollar, euro against the RMB, forward exchange rates, and exchange rates of other currency pairs [20][21][22]

Investment Rating - The report maintains an "Accumulate" rating for the environmental protection industry [1]. Core Views - The report highlights that the environmental protection sector is entering a mature phase, leading to improved free cash flow and increased dividends due to reduced capital expenditures. The focus is on enhancing operational efficiency through heat supply and IDC collaborations, which are expected to boost ROE and valuations [12][14]. Summary by Sections Industry Trends - The environmental protection sector is experiencing a shift towards maturity, with capital expenditures decreasing and free cash flow turning positive in 2023, continuing to improve in 2024. This trend is expected to enhance dividend payouts significantly [12][14]. - The report notes that the waste incineration segment is seeing a decline in capital expenditures, which is positively impacting free cash flow and dividend distributions [12][14]. Company Insights - Huanlan Environment is expanding its heat supply business, leveraging existing waste incineration projects to improve operational efficiency and cash flow. The company has signed multiple heat supply agreements and is expected to increase its heat supply volume significantly in the coming years [9][10][11]. - The report emphasizes the strong dividend potential of several companies, including Junxin Co. with a cash dividend of 507 million yuan in 2024, Green Power with 418 million yuan, and Huanlan Environment with a proposed dividend of 652 million yuan [12][13][14]. Market Developments - The report indicates that the water services sector is also showing stable growth, with a projected revenue of 655 billion yuan in 2024, despite a slight decline due to one-time gains. The sector is expected to benefit from ongoing water price reforms, which will enhance profitability and valuation [16][18][19]. - The report highlights the increasing penetration of new energy sanitation vehicles, with sales growing by 73% in the first five months of 2025, indicating a shift towards more sustainable practices in the industry [26][32]. Future Outlook - The report suggests that the environmental protection industry is poised for a new phase of growth driven by market reforms and operational efficiencies. Companies that can effectively manage their cash flows and adapt to changing market conditions are expected to see significant valuation increases [20][24].

Core Viewpoint - The chairman of Sunac China, Sun Hongbin, expressed optimism at the shareholders' meeting, stating that the most difficult times for the company are over, signaling a potential recovery for the firm [2][11]. Debt Restructuring - Sunac China announced a significant breakthrough in its debt restructuring, with a total of approximately $9.55 billion in overseas debt being converted into equity [4][6]. - The debt-to-equity conversion plan has received support from about 75% of the holders of the existing debt, indicating a strong consensus among creditors [6][7]. - The total debt, including both overseas and domestic, amounts to approximately 83.85 billion yuan, equivalent to about 100 tons of gold [7]. Sales Performance - Sunac's project, the Bund No. 1 Phase II, achieved a remarkable sales figure of 9.997 billion yuan in April 2024, marking it as one of the highest-selling projects in Shanghai [9]. - The company reported a cumulative sales figure exceeding 17 billion yuan in the first half of the year, securing the title of the top-selling project in the country [9][10]. Financial Performance - In 2024, Sunac China reported revenues of approximately 74.02 billion yuan, a significant decline of 52% year-on-year, while gross profit turned from a loss of 2.5 billion yuan in 2023 to a profit of 2.89 billion yuan [10]. - However, the loss attributable to shareholders widened from 7.97 billion yuan in 2023 to 25.7 billion yuan in 2024, indicating ongoing financial challenges [10]. Strategic Focus - Sunac is shifting its strategy to focus on major cities and improving project quality, aiming to replicate the success of the Bund No. 1 project [10]. - The company is undertaking a thorough review of its residential projects, implementing tailored strategies for debt restructuring and asset revitalization [10].

Core Viewpoint - The Guangxi Autonomous Region is mobilizing efforts to support Liuzhou in addressing its severe local debt crisis, which has escalated due to a combination of industrial decline and aggressive urban construction policies [1][14]. Summary by Sections Liuzhou's Debt Situation - Liuzhou's local government debt reached 1,042.7 billion yuan by the end of last year, with 788.4 billion yuan attributed to the municipal level [3]. - The city has a debt ratio of 166.39%, the highest among major cities in Guangxi [2]. - Liuzhou's financing platforms have accumulated significant hidden debts, with a total of 2,159.02 billion yuan in interest-bearing liabilities [3]. Financial Challenges - In 2024, Liuzhou's fiscal revenue is projected to be 149 billion yuan, a 4.8% decrease from 2023, while expenditures are expected to rise by 21.7% to 462 billion yuan [4]. - The city's government fund income is anticipated to drop by 53.6% to 60.66 billion yuan, exacerbating the financial strain [4]. Historical Context of Debt Accumulation - Liuzhou's debt issues stem from a history of structural imbalances, characterized by industrial stagnation and aggressive urban development [5]. - The city was once a major automotive hub, but production has declined significantly since 2017, leading to a drop in industrial output [8]. Political and Economic Implications - The debt crisis is not only a financial issue but also reflects deeper political and governance challenges within Liuzhou [14]. - The Guangxi government has proposed a comprehensive debt resolution plan, emphasizing the need for political support alongside financial measures [14]. Future Prospects and Strategies - The Guangxi government has committed to a three-year plan to help Liuzhou achieve a positive financial cycle, focusing on asset revitalization and risk prevention [14]. - Liuzhou aims to leverage artificial intelligence and manufacturing integration as a key strategy for economic recovery, with a target to exceed 100 billion yuan in AI-related industry output by 2027 [15][16].

Group 1 - The core focus of the article is on the significant issuance of local government bonds in China, amounting to 5.49 trillion yuan in the first half of 2025, primarily aimed at "debt replacement" and supporting infrastructure investment [1][2] - The issuance of refinancing special bonds for replacing hidden debts reached nearly 1.8 trillion yuan, with an issuance progress of about 90%, while new special bonds issued amounted to 2.16 trillion yuan, accounting for nearly 50% of the annual quota [1][2] - The urgency of "debt replacement" is highlighted as the primary task for local governments, with 42% of new special bonds in June allocated for this purpose, reflecting the pressing need to address existing debt issues [3][4] Group 2 - The issuance of local government bonds is expected to accelerate in the second half of the year, with plans for approximately 1.69 trillion yuan in new bonds, including 1.47 trillion yuan in new special bonds [6] - The focus on "debt replacement" has somewhat constrained the issuance of new local government bonds, impacting project initiation [6][7] - The government is also exploring innovative uses of special bonds, such as funding investment guidance funds to support strategic emerging industries [7]

化债持续推进，部分环保企业应收问题改善 【】【】[Table_Industry] 环保周报 [Table_ReportDate] 2025 年 6 月 29 日 156.tcy 证券研究报告 行业研究——周报 [Table_ReportType] 行业周报 [Table_StockAndRank] 环保 投资评级 看好 上次评级 看好 [左前明 Table_Author] 能源行业首席分析师 执业编号：S1500518070001 联系电话：010-83326712 邮 箱：zuoqianming@cindasc.com 郭雪 环保联席首席分析师 执业编号：S1500525030002 邮 箱：guoxue @cindasc.com 吴柏莹 环保行业分析师 化工行业： 执业编号：S1500524100001 邮 箱：wuboying@cindasc.com 信达证券股份有限公司 CINDA SECURITIES CO.，LTD 北京市西城区宣武门西大街甲127号金隅大厦 B座 邮编：100031 [Table_Title] 化债持续推进，部分环保企业应收问题改善 2025 年 6 月 29 日 本期内容提要: ...