Investment Rating - The report maintains a "Recommended" rating for Longking Environmental [2] Core Views - The report highlights the high profitability potential of the Congo (DRC) hydropower projects, specifically the Kailangeng hydropower station and the Mami Cuo energy station [5] - The company is expected to see significant growth in net profit from 2025 to 2027, with projected net profits of 11.64 billion, 14.25 billion, and 16.66 billion respectively, corresponding to PE ratios of 14.33x, 11.70x, and 10.01x [5] Financial Forecast Summary - **Revenue Forecast**: - 2024A: 10,019.42 million - 2025E: 11,807.95 million (17.85% growth) - 2026E: 13,221.30 million (11.97% growth) - 2027E: 14,701.36 million (11.19% growth) [6] - **Net Profit Forecast**: - 2024A: 830.40 million - 2025E: 1,163.96 million (40.17% growth) - 2026E: 1,425.03 million (22.43% growth) - 2027E: 1,666.14 million (16.92% growth) [6] - **Gross Margin**: - Expected to remain stable around 25% from 2024 to 2027, with slight increases [6] - **Earnings Per Share (EPS)**: - 2024A: 0.65 - 2025E: 0.92 - 2026E: 1.12 - 2027E: 1.31 [6] - **Price-to-Earnings (PE) Ratio**: - 2024A: 20.08 - 2025E: 14.33 - 2026E: 11.70 - 2027E: 10.01 [6] Project Highlights - **Kailangeng Hydropower Project**: - Investment of approximately 3.99 billion USD (28.42 billion RMB) - Expected annual generation of 714 million kWh with a high utilization rate of 5,100 hours [5] - Power purchase agreements ensure 90% of electricity is sold to Zijin Mining at a competitive rate of approximately 0.16 USD/kWh [5] - **Mami Cuo Energy Station**: - Expected to begin operations in Q2 2026 with a competitive settlement price of 0.7 RMB/kWh - The project aims to support lithium-boron mining operations in a remote area [5]

Investment Rating - The report maintains a "Recommended" rating for Longking Environmental [2] Core Views - The report highlights the high profitability of the Congo (DRC) hydropower projects, specifically the Kailangeng hydropower station and the Mami Cuo energy station, which are expected to significantly contribute to the company's profits [5][6] - The company is positioned to benefit from its strategic investments in clean energy and environmental protection, with a strong pipeline of projects and contracts [5][6] Financial Forecast Summary - **Revenue Forecast**: Projected revenues for 2024A, 2025E, 2026E, and 2027E are 10,019.42 million, 11,807.95 million, 13,221.30 million, and 14,701.36 million respectively, with a revenue growth rate of -8.69% in 2024, followed by 17.85%, 11.97%, and 11.19% in the subsequent years [6] - **Net Profit Forecast**: Expected net profits for the same years are 830.40 million, 1,163.96 million, 1,425.03 million, and 1,666.14 million, with profit growth rates of 63.15%, 40.17%, 22.43%, and 16.92% respectively [6] - **Key Ratios**: The projected PE ratios for 2024A, 2025E, 2026E, and 2027E are 20.08, 14.33, 11.70, and 10.01 respectively, indicating a decreasing trend in valuation multiples as earnings grow [6][7] Project Highlights - **Kailangeng Hydropower Project**: The project has a total investment of approximately 3.99 billion USD, with an expected annual generation of 714 million kWh and a high utilization rate of 5,100 hours per year. The electricity price for mining operations is around 0.16 USD/kWh [5] - **Mami Cuo Energy Station**: This project is expected to have a competitive electricity settlement price of 0.7 RMB/kWh and is projected to generate an average annual output of 761 million kWh [5] Strategic Positioning - The company is focusing on a dual strategy of environmental protection and new energy, with significant contracts in hand and a strong market position in the environmental sector [5][6] - The integration of energy production, storage, and consumption in remote areas is expected to enhance the stability and profitability of the company's projects [5]

Core Viewpoint - Longjing Environmental Protection (龙净环保) has announced the acquisition of an 80% stake in the Kairangeng Hydropower Station project in the Democratic Republic of Congo, which is a significant step in the company's strategy to enhance its global clean energy footprint and support Zijin Mining's operations in the region [1] Group 1 - The Kairangeng Hydropower Station is located on the Lualaba River in Haut Lomami Province, 200 km from Zijin Mining's operations in Kolwezi, where there is a significant electricity shortage [1] - The total investment for the project is approximately $399 million, which will be funded by the company [1] - The project has a capacity of 140 MW and aims to prioritize electricity supply to Zijin Mining's enterprises in the Democratic Republic of Congo, thereby enhancing industrial synergy and reducing electricity costs [1] Group 2 - This project is a key initiative for the company to implement its "environmental protection + new energy" dual-driven strategy and deepen its global clean energy layout [1] - The completion of this project is expected to enhance the company's competitiveness and brand influence in overseas markets [1] - The implementation of the project will expand the scale of clean energy generation and provide a sustainable profit growth point, aligning with the company's long-term development strategy and the global trend towards low-carbon development [1]