Core Viewpoint - The company reported steady growth in performance, driven by multi-source solid waste treatment and cost reduction, with a revenue of 2.065 billion yuan and a net profit of 461 million yuan in the first half of 2025, representing a year-on-year increase of 13% and 9% respectively [1][2]. Financial Performance - In the first half of 2025, the company achieved an operating income of 2.065 billion yuan, a year-on-year increase of 13%, and a net profit attributable to shareholders of 461 million yuan, up 9% year-on-year [1][2]. - The company maintained healthy cash flow from operating activities, with a net amount of 926 million yuan, laying a solid foundation for high-quality development [2]. Business Expansion - The company completed a 41% equity acquisition of Shanxi Jiejin Company, increasing its stake to 90%, thereby expanding its business footprint into Shanxi Province [3]. - The company provided a total of 88,300 tons of steam to surrounding industrial enterprises during the reporting period, indicating continuous growth in its heating business [3]. Shareholder Returns - The company has implemented a cash dividend distribution for the 2024 fiscal year, with a payout of 6.00 yuan (including tax) per 10 shares, totaling 540 million yuan, which accounts for 65.81% of the net profit attributable to shareholders for 2024, ranking among the top in the industry [3]. Future Outlook - The company anticipates that the stockpiled waste excavation projects will provide a clear source of waste volume growth over the next 2-3 years, while the planning and construction of heating pipelines and potential green electricity supply collaborations for data centers may open new growth opportunities in the long term [3]. Profit Forecast - The company is expected to achieve operating revenues of 4.136 billion yuan, 4.483 billion yuan, and 4.704 billion yuan for 2025-2027, with year-on-year growth rates of 9.86%, 8.39%, and 4.94% respectively, and net profits of 920 million yuan, 1.049 billion yuan, and 1.124 billion yuan, with growth rates of 12.07%, 14.08%, and 7.17% respectively [4].

Investment Rating - The investment rating for the company is "Buy" [1] Core Views - The company has shown steady growth driven by both organic growth and external acquisitions, with a 12.60% year-on-year increase in revenue to 2.065 billion yuan and a 9.32% increase in net profit to 461 million yuan in the first half of 2025 [1][3] - The total amount of waste processed in the company's waste incineration power generation projects reached 5.3583 million tons, with power generation of 2.576 billion kWh, indicating robust growth across various metrics [3] - The company has successfully expanded its heating scale and is exploring new heating solutions, providing a total of 88,300 tons of steam to surrounding industrial enterprises [3] - Cost reduction and efficiency improvement measures have led to a gross margin increase to 43.36%, while financial expenses decreased by 21.86% year-on-year [3] - The company is expected to maintain stable dividends above 60%, with projected revenues of 4.134 billion yuan, 4.387 billion yuan, and 4.751 billion yuan for 2025, 2026, and 2027 respectively [3][4] Financial Summary - In the first half of 2025, the company achieved a net cash flow from operating activities of 926 million yuan, a 1.97% increase year-on-year [3] - The company's gross margin is projected to be 42.5% in 2025, with a return on equity (ROE) of 8.6% [4] - The earnings per share (EPS) is expected to be 1.04 yuan in 2025, with a price-to-earnings (P/E) ratio of 15.46x [4]