LK(600388) 长江证券·2024-12-09 06:43Investment Rating - The report maintains a "Buy" rating for Longjing Environmental Protection (600388 SH) [9] Core Views - Longjing Environmental Protection has released a series of plans including a stock option incentive plan a cash dividend plan for the next three years (2024-2026) and an employee stock ownership plan These initiatives aim to enhance the company's performance certainty and align employee interests with company performance [2][5] - The company targets a 10% year-on-year revenue growth and an ROE of at least 10% over the next three years Additionally it plans to distribute at least 40% of its cumulative distributable profits in cash over the next three years [2][5] - The company's first pure electric mining truck battery swap project has been successfully put into operation which is expected to contribute to long-term performance certainty [2][5] Incentive Plans - The stock option incentive plan covers 457 employees including directors core management and key employees with a total of 36 million shares granted representing 2 95% of the total shares as of November 29 The exercise price is set at 12 23 yuan per share [5] - The employee stock ownership plan involves up to 463 employees including 9 directors and senior executives with a total of 7 51 million shares representing 0 62% of the total shares as of November 29 The plan has a lock-up period of 12 months and a duration of 48 months [6] Financial Projections - The company is expected to achieve net profits of 1 013 billion yuan 1 403 billion yuan and 1 7 billion yuan in 2024 2025 and 2026 respectively representing year-on-year growth of 99 0% 38 5% and 21 2% The corresponding PE ratios are 14 6x 10 6x and 8 7x [7] - The company's EPS is projected to be 0 42 yuan 0 83 yuan 1 15 yuan and 1 39 yuan for 2023 2024 2025 and 2026 respectively [16] Strategic Focus - Longjing Environmental Protection is pursuing a dual-drive strategy focusing on both environmental protection and new energy sectors The company has strong capabilities in securing contracts for its environmental protection business and is making progress in the green power and energy storage sectors [7] - The company has entered the mining equipment business with related transactions expected to reach up to 370 million yuan this year [6] Dividend Policy - The company plans to increase its cash dividend payout with a target of distributing at least 40% of its cumulative distributable profits over the next three years This is expected to enhance shareholder returns and investor confidence [10]