Core Viewpoint - Longjing Environmental Protection (龙净环保) is actively pursuing its "environmental protection + new energy" dual-driven strategy by investing in significant projects both domestically and internationally, with a total investment exceeding 5.2 billion yuan in a single day [2][5]. Group 1: Project Developments - The company announced the acquisition of 80% of GML in the Democratic Republic of Congo, securing the development rights for the 140MW Kalan Geng Hydropower Station, with a total investment of approximately 3.99 billion USD (about 28.43 billion yuan) [3][4]. - Additionally, the company plans to invest in the Mami Cuo Integrated Energy Station project, with a total investment of around 2.39 billion yuan, which includes a combination of solar, energy storage, and thermal power generation [5][6]. Group 2: Financial Performance - Longjing Environmental Protection has maintained over 10 billion yuan in annual revenue for six consecutive years, with a reported revenue of 10.02 billion yuan in 2024, a decrease of 8.69% year-on-year, while net profit increased by 63.15% to 830 million yuan [7][8]. - In the first half of 2025, the company achieved a revenue of 4.68 billion yuan, a slight increase of 0.24% year-on-year, and a net profit of 445 million yuan, up 3.27% [7][8]. Group 3: Market Position and Strategy - The company holds a robust position in the environmental protection industry, with a total of 19.97 billion yuan in contracts on hand as of mid-2025, solidifying its status as an industry leader [8]. - Longjing Environmental Protection emphasizes technological innovation and has increased its R&D expenditure to 219 million yuan in the first half of 2025, reflecting a 4.7% year-on-year growth [8].

Core Viewpoint - The company reported steady growth in performance, with significant contributions from the new energy business, achieving operating revenue of 4.683 billion yuan, a year-on-year increase of 0.24%, and a net profit attributable to shareholders of 445 million yuan, a year-on-year increase of 3% [2] Group 1: Financial Performance - In the first half of 2025, the company achieved operating revenue of 4.683 billion yuan, which is essentially flat year-on-year [2] - The net profit attributable to shareholders reached 445 million yuan, reflecting a year-on-year growth of 3% [2] - The net profit after deducting non-recurring items was 416 million yuan, showing a year-on-year increase of 7% [2] Group 2: New Energy Business - The rapid development and profitability improvement of the new energy business were the main drivers of performance growth, with nearly 1 billion yuan in net profit generated from this segment in the first half of the year [2] - The energy storage cell business achieved full production and sales through deepened cooperation with Yiwei Lithium Energy, significantly improving operational conditions [2][3] - The company is executing a "dual-drive strategy" of "environmental protection + new energy," with the new energy business entering a fast development phase [3] Group 3: Environmental Business - The traditional environmental protection business remains stable and healthy, providing a solid performance foundation, with new environmental equipment engineering contracts totaling 5.370 billion yuan during the period [2] - The company’s traditional air pollution control business maintains a leading position, with a balanced business structure, where the power industry accounted for 61.61% of new orders [4] - The company is proactively responding to the clean and efficient transformation of coal power and the ultra-low emission renovation needs of non-electric industries [4] Group 4: Strategic Initiatives - The company is strategically entering emerging sectors, having acquired a 20% stake in Zhejiang Jitai Intelligent Technology Co., aiming to penetrate the special robot sector in the energy field [4] - This move is intended to leverage the company's extensive customer resources in power plants and form strategic synergies with Jitai Intelligent in technology and channels [4] - The company is also focusing on the electrification opportunities in mining trucks, with independent research and development of electric mining trucks progressing smoothly [3] Group 5: Profit Forecast - The company is expected to achieve operating revenues of 12.033 billion yuan, 14.009 billion yuan, and 16.360 billion yuan for 2025-2027, with year-on-year growth rates of 20.09%, 16.43%, and 16.78% respectively [4] - The net profit attributable to shareholders is projected to be 1.226 billion yuan, 1.423 billion yuan, and 1.705 billion yuan for the same period, with year-on-year growth rates of 47.69%, 16.05%, and 19.77% respectively [4] - Based on the closing price on August 27, 2025, the corresponding PE ratios are expected to be 12.88, 11.10, and 9.27 times, with EPS of 0.97, 1.12, and 1.34 yuan respectively [4]

Summary of Longking Environmental Conference Call Company and Industry Overview - **Company**: Longking Environmental - **Industry**: Environmental Protection and New Energy Key Points and Arguments 1. **Strategic Partnership**: Longking Environmental benefits from Zijin Mining's acquisition, establishing a "Environmental Protection + New Energy" dual-drive strategy with Zijin holding over 25% and the Longyan State-owned Assets Supervision and Administration Commission holding nearly 10% [2][5] 2. **Green Energy and Storage Development**: The company is focusing on green electricity and energy storage, with green energy projects aligned with Zijin's green mining transformation, and expected operational improvements in energy storage by 2025 [2][5] 3. **Non-Electric Sector Breakthroughs**: Longking has achieved significant advancements in non-electric sectors, including the world's first dry desulfurization technology applied to steel sintering machines, leading industry standards [2][6] 4. **Stable Order Volume**: Despite concerns over reduced orders in thermal power emissions control, the company maintains a stable order volume of around 10 billion annually, with unexecuted orders between 18-20 billion [2][10] 5. **Core Business and Competitive Advantage**: The core business includes flue gas treatment (desulfurization, denitrification, and dust removal), with a market share of nearly 50% in dust removal and about 20% in desulfurization [3][4] 6. **Financial Performance**: The company expects a net profit of 830 million yuan in 2024, impacted by losses in micro-fee businesses and goodwill impairment, with the environmental main business contributing approximately 920 million yuan [3][20] 7. **Future Growth in Green Energy**: Green energy is projected to contribute around 200 million yuan in 2025, with a focus on self-consumption and grid-connected power generation [12] 8. **Cash Flow and Debt Management**: The company has a strong cash flow and collection capability, with a high apparent debt ratio due to significant advance payments, reflecting its premium pricing ability [16][18] 9. **Employee Stability**: The implementation of a 10-year employee stock ownership plan has improved employee stability and morale [14][15] 10. **Market Expansion**: Longking is actively expanding into high-temperature industries such as steel, cement, and coking, which have substantial desulfurization and denitrification needs [4][7] Additional Important Information - **Board Structure**: The board consists of representatives from Zijin Mining, Longking Environmental, and the Longyan State-owned Assets Supervision and Administration Commission, facilitating smooth cooperation [8] - **Future Order Trends**: The company anticipates continued demand for emissions control due to ongoing regulatory requirements and the need for upgrades in existing facilities [9] - **Investment Focus**: Recent investments are primarily directed towards green energy projects, with clear funding purposes and avoidance of high-risk ventures [17] - **Robotics and Equipment Development**: The company is exploring robotics for flue gas treatment facility maintenance, although current contributions to earnings are limited [13] This summary encapsulates the essential insights from the conference call, highlighting Longking Environmental's strategic direction, financial outlook, and market positioning within the environmental protection and new energy sectors.

Investment Rating - The investment rating for the company is "Buy" and is maintained [7]. Core Views - On May 29, 2025, the company announced an investment of 75.075 million yuan to acquire a 20% stake in Jitai Intelligent, aiming to become the second-largest shareholder. Jitai Intelligent specializes in wall-climbing inspection robots and related operation and maintenance systems, which have certain synergies with the company's business. The target company is expected to achieve a net profit of 12.67 million yuan in 2024, and its performance is anticipated to improve significantly under the market support of the company [2][4][10]. Summary by Sections Event Description - The company plans to invest 75.075 million yuan to acquire a 20% stake in Jitai Intelligent, which will make it the second-largest shareholder [4]. Financial Performance and Forecast - Jitai Intelligent is projected to achieve revenues of 91.6537 million yuan and a net profit of 12.67 million yuan in 2024. The company expects to see a strong performance boost from the market support provided by the company [10]. - The company has a dual-driven strategy of "environmental protection + new energy," with strong order acquisition capabilities in its main business. It anticipates net profits of 1.152 billion yuan, 1.503 billion yuan, and 1.802 billion yuan for 2025, 2026, and 2027, respectively, representing year-on-year growth of 38.7%, 30.5%, and 19.9% [10].