Fundraising Plan - The company plans to raise a total of 300 million yuan, with the net proceeds intended for specific projects after deducting issuance costs [1] - The main project is the construction of a 100,000-ton hydrocarbon-based biodiesel production facility, with a total investment of 380 million yuan and a construction period of two years [2][3] Project Necessity - The project aims to utilize waste oils, such as kitchen waste oil, to produce biodiesel, addressing environmental concerns and reducing reliance on limited petroleum resources [2][3] - The project aligns with national policies promoting the recycling of waste oils and the development of renewable energy sources [3][4] Project Feasibility - The project can flexibly adjust the output of HVO/SAF based on market demand, utilizing advanced biochemical technology for further processing [3][7] - The company has established a strong technical foundation and has been recognized as a national high-tech enterprise, with various research achievements in biodiesel technology [7][9] Market Outlook - The demand for HVO and SAF is expected to increase significantly due to global environmental concerns and regulations promoting the use of biofuels [7][8] - The company has developed extensive sales channels and partnerships in the international market, ensuring stable sales of its products [8][9] Technological and Talent Reserves - The company possesses a robust R&D team and has developed multiple patented technologies in biodiesel production, enhancing its competitive edge [8][9] - The company has built a comprehensive professional team in product development, production management, and quality control, ensuring the successful implementation of the fundraising project [9] Alignment with National Policies - The fundraising project aligns with national industrial policies that support the development of renewable energy and circular economy industries [9][10] - The project is categorized under strategic emerging industries, emphasizing its importance in the national energy strategy [9][10]

Core Viewpoint - The company is issuing shares to specific investors, which will dilute immediate returns for existing shareholders, and has outlined measures to mitigate this impact [1][5][12]. Group 1: Impact of Share Issuance - The company plans to issue 7,190,795 shares, increasing total shares from 120 million to 127,190,795 [2]. - The estimated net profit for 2025 is projected at 14,901.88 million, with three scenarios for profit changes: flat, a 10% decrease, and a 10% increase [2][4]. - The basic earnings per share (EPS) before and after the issuance under different scenarios are detailed, showing a potential decrease in EPS due to dilution [4][10]. Group 2: Project Necessity and Rationality - The funds raised will be used for a project to produce 100,000 tons of hydrocarbon-based biodiesel, with a total investment of 380 million [5][6]. - The project aims to utilize waste oils, contributing to environmental protection and resource conservation, aligning with national policies on sustainable development [6][10]. - The company has a strong technical foundation and market presence in the biodiesel sector, enhancing its competitive edge [11]. Group 3: Measures to Mitigate Dilution Impact - The company will implement strict management of the raised funds to ensure they are used effectively for the intended projects [12][13]. - Operational improvements will be pursued to enhance efficiency and profitability, including cost management and governance structure enhancements [13][14]. - A profit distribution policy will be refined to ensure fair returns to shareholders, particularly small investors, following the share issuance [14][15]. Group 4: Commitments from Company Stakeholders - The company's board and senior management have committed to ensuring the effectiveness of the measures to mitigate dilution impacts [15][16]. - The controlling shareholders have also made commitments to not interfere with the company's management and to protect shareholder interests [16].

Group 1 - The company, Longyan Zhuoyue New Energy Co., Ltd., plans to issue shares to specific investors to raise funds for expanding its production capacity of biofuels, particularly hydrocarbon-based biodiesel (HVO) and sustainable aviation fuel (SAF) [14][18][28] - The issuance price is set at 41.72 RMB per share, which is not lower than 80% of the average trading price over the previous 20 trading days [21][24] - The total number of shares to be issued is approximately 7,190,795, which does not exceed 30% of the company's total share capital prior to the issuance [21][24] Group 2 - The company aims to utilize the raised funds to enhance its production capabilities, particularly in the processing of waste oils, which are abundant and pose environmental risks if not properly managed [18][29] - The project aligns with national policies promoting renewable energy and aims to reduce reliance on fossil fuels while addressing environmental concerns [14][30][33] - The company has established itself as a leading player in the biodiesel market, with a strong focus on technology and innovation in the utilization of waste oils for biodiesel production [18][33] Group 3 - The issuance is expected to improve the company's liquidity and optimize its shareholding structure, ensuring long-term governance and sustainability [20][26] - The company has a solid technical foundation and market presence, having been involved in biodiesel production for over 20 years, which enhances its competitive edge in the industry [18][33] - The global demand for biodiesel is projected to grow significantly, driven by regulatory support and environmental initiatives, particularly in Europe and the aviation sector [16][17][18]

Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [1]. Core Views - The company,卓越新能, is a pioneer in the industrial production of biodiesel in China, focusing on the integrated biomass energy layout and continuously increasing R&D investment [3][10]. - The biodiesel market is expected to maintain a tight balance in supply and demand, with a focus on raw material substitution and overcoming trade barriers [3][4]. - The company is expanding its overseas sales network and enhancing its product offerings in biobased materials, which is expected to bolster its competitive edge [3][4]. Summary by Sections 1. Integrated Biomass Energy Layout -卓越新能 is the largest producer of biodiesel in China, with a production capacity of approximately 500,000 tons as of June 2024, and a biobased materials capacity of 90,000 tons [3][14]. - The company has a strong focus on R&D, enhancing the value-added of its products and the utilization rate of waste oils [10][14]. 2. Tight Supply-Demand Balance in Biodiesel - The report highlights the ongoing tight balance in the biodiesel market, with a projected supply-demand gap of 350,000 tons in 2024, -120,000 tons in 2025, and 770,000 tons in 2026 [3][5]. - The company is expected to benefit from the rising price of waste oils as a raw material, which is becoming increasingly cost-effective compared to traditional vegetable oils [3][40]. 3. Overseas Channels and Biobased Materials -卓越新能 has established subsidiaries in Singapore and the Netherlands to enhance its global trading capabilities and mitigate the impact of trade barriers [3][4]. - The company is also expanding its biobased materials segment, with a new 50,000-ton natural fatty alcohol project expected to contribute significantly to profits [4][14]. 4. Profit Forecast and Valuation - The company is projected to achieve net profits of 157 million, 634 million, and 792 million yuan for the years 2024, 2025, and 2026, respectively, reflecting significant growth rates [5][19]. - The report anticipates that the company's earnings per share (EPS) will reach 1.30, 5.28, and 6.60 yuan for the same years [5][19].