Summary of Investment

• The annual result is in line with expectations and the growth momentum of biomass is strong;
• Strong project expansion ability and efficient operation and management;
• Benefiting from government support, the industry remains booming;

Investment Rating

Based on the business layout, the company founded three management centers, including clean energy, solid waste and environmental restoration. While consolidating existing main business, the company actively enhances natural gas, soil, soil remediation to brew a new growth point. Based on the fundamentals of good quality and the boom of the biomass and hazardous waste industry, we expect the net profits attributable to the parent company in 2018-2019 will reach HKD1345 / 1680 million, and the EPS will be HKD0.65/0.81, equivalent to the PE of HKD12.0 / 9.6, respectively. The target price of HKD 9.36 and an Accumulate rating is given.