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Was water treatment enterprise "holding thighs" to "live" or "live well"?

发布时间:2019-05-29 10:08:23

On April 7, Chongqing listed company Kangda Environmental Protection announced that Li Zhong, Liu Yujie and Lin Nan had been appointed as executive directors and Zhou Jinrong had been appointed as independent non-executive directors. All four of them are from China's water sector.
  On the evening of April 3, China Water announced that Sharp Profit Investments Limited, its wholly-owned subsidiary, had signed an acquisition agreement with Kangda Environmental Protection. According to the agreement, China Water agreed to buy about 29.52% of the total issued equity of Kangda Environmental Protection Company, or a total of 600 million shares, totalling 1.2 billion Hong Kong dollars.
  After the completion of the transaction, China Water will become the largest shareholder of Kangda Environmental Protection. In the future, Kangda Environmental Protection will also be listed as a water joint venture in China, contributing to profits.
  At the beginning of the year, there were many cases of large shareholders introduced by water enterprises, which may set the tone for this year's water market.
China's water industry and Kangda's environmental protection are not small, and there are certain complementarities in their business. This merger can be said to be a door-to-door.

The core business of China's water industry is basically concentrated in water supply and environmental protection, including the provision of sewage treatment and drainage management and construction services, solid waste and hazardous waste business, environmental sanitation and water environment management. In fiscal year 2018, China's total water revenue reached HK$7.58 billion, with 81.8% and 10.7% of the revenue from water supply and environmental protection respectively.

The core cause of Kangda's environmental protection is more concentrated on urban water treatment, comprehensive water environment treatment and rural sewage treatment. At present, there are 107 projects in Kangda Environmental Protection Urban Water Treatment Division, with a total design and treatment capacity of 4.2684 million tons per day. As the leading enterprises in the same industry, both sides can be said to know the root of the matter. With many years of listing on the Hong Kong Stock Exchange, business can also complement each oth
For China's water industry, after the acquisition of Kangda Environmental Protection, its business will be extended to Shandong, Heilongjiang, Zhejiang, Anhui, Shanxi and other provinces, with rapid expansion of local influence.
For Kangda environmental protection, it not only reduces the cost of financing, finds the source of funds for many projects in its hands, but also effectively improves its financial level.
Comparing with China's water industry, Kangda's environmental finance is slightly inferior. In 2018, Kangda Environmental Protection's corporate income tax expenditure rate is as high as 32%, gross interest rate is 36.18%, net interest rate is 10.25%, and net loan ratio is 187%. If we can integrate better management experience and mode, Kangda's environmental protection performance will be more promising.
    In 2018, the water industry sounded the clarion call in the second half. Under the new trend, water enterprises also began the upsurge of capital.
On March 29, Xingyuan Environment announced that controlling shareholder Xingyuan Holdings signed a share transfer agreement with Xinwang Investment Group, and Xingyuan Holdings transferred 23.60% of its shares to Xinwang Investment Group. Liu Yonghao, the feed king, succeeded in taking over the fourth listed company.
The troubled water company stumbled for half a year and finally found a "good father" after failing to talk with the General Administration of Coal Geology of China.
It is hoped that the richest man in Sichuan will bring new vitality to the environment of Xingyuan.
Of course, unlike last year's crisis enterprises eager to seek capital, now the leading water industry has also begun to "fight daddy".
At the beginning of the year, Bishui attracted Chuantou Group to escort itself and gradually expand its business to the southwest region; North Water Control is a marriage of the Three Gorges Group, hoping to make a difference in the Yangtze River Basin; as an environmental comprehensive service provider, Sander is also close to Xiongan Group, which is rich in wealth.
In the latter half of the water market, there is an obvious feature that environmental protection enterprises are no longer fighting alone.
There is no doubt that the most popular projects in the water industry in 2019 are probably rural sewage treatment and watershed treatment (especially in the Yangtze River Basin). The former needs deep-ploughing layout in different areas, while the latter needs more abundant capital and more sophisticated technology, which makes the marriage and investment attraction between water enterprises become the main theme of 2019.
One fence and three piles. In the future, regional governance will become a trend, and such alliances will become more common. Over the next few years, whether in large or small enterprises, the cooperation between enterprises will become more and more close, and it is difficult to follow the trend alone.

Can there be "super enterprises" in these consortia? It's worth looking forward to.