Datang Environment Industry Group Co., Ltd. Class H (1272) AI Stock Analysis

• Market Cap: HK$3.56B
• Dividend Yield: 7.61%
• Average Volume (3M): 130.07K
• Price to Earnings (P/E): 7.6
• Beta (1Y): 0.51
• Revenue Growth: -4.41%
• EPS Growth: -34.31%
• Country: HK
• Employees: 979
• Sector: Industrials
• Sector Strength: 72
• Industry: Waste Management
• EPS (TTM): 0.10
• Shares Outstanding: 624,296,200
• 10 Day Avg. Volume: 125,800
• 30 Day Avg. Volume: 130,066
• PEG Ratio: 0.84
• Price to Book (P/B): 0.33
• Price to Sales (P/S): 0.44
• P/FCF Ratio: 1.88
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: HK$1.48
• Price Target Upside: 26.50% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 72 Outperform
• Price Target: HK$1.50 ▲(28.21% Upside)

The overall stock score of 71.5 reflects a balanced financial performance with strong cash flow generation and reasonable profitability. The valuation is attractive with a low P/E ratio and high dividend yield, making it appealing for value and income investors. However, technical indicators suggest a lack of strong momentum, which could limit short-term price appreciation.

Positive Factors

Cash Generation

Strong cash generation capabilities enhance financial stability and provide resources for reinvestment and debt reduction, supporting long-term growth.

Profitability

Solid profitability margins reflect efficient operations and cost management, which can sustain competitive positioning and shareholder returns over time.

Moderate Leverage

Moderate leverage provides a balance between risk and growth potential, ensuring financial flexibility and stability in varying economic conditions.

Negative Factors

Revenue Growth Decline

A decline in revenue growth can indicate challenges in market expansion or competitive pressures, potentially impacting long-term business sustainability.

Declining Assets

A decrease in assets and equity may limit future investment capacity and growth opportunities, posing risks to long-term financial health.

EBITDA Margin Decline

A declining EBITDA margin suggests potential cost pressures or pricing challenges, which could erode profitability and competitive advantage over time.

Datang Environment Industry Group Co., Ltd. Class H Business Overview & Revenue Model

Company Description

Datang Environment Industry Group Co., Ltd. provides environmental protection and energy conservation solutions to coal-fired power generation enterprises in the People's Republic of China. The company operates through Environmental Protection and Energy Conservation Solutions; Renewable Energy Engineering; Thermal Power Engineering; and Other Businesses segments. The Environmental Protection and Energy Conservation Solutions segment engages in the flue gas desulfurization and denitrification facilities concession operation business for coal-fired power plants; the manufacture and sale of denitrification catalysts; engineering business for coal-fired power plants, including the engineering of denitrification, desulfurization, dust removal, ash and slag handling, other environmental protection facilities, and industrial site dust management related engineering; water treatment business; and energy conservation business, such as energy conservation facility engineering and energy management contract. The Renewable Energy Engineering segment provides engineering general contracting services for newly built wind power plants, biomass power plants, and photovoltaic power plants. The Thermal Power Engineering segment offers engineering, procurement, and construction services for thermal power plants. The Other Businesses engages in the fiberglass chimney anti-corrosion, air cooling system engineering general contracting business. It also engages in the development of pollution improvement environmental protection technology, and provision of engineering and technology services. The company was founded in 1984 and is headquartered in Beijing, the People's Republic of China. Datang Environment Industry Group Co., Ltd. is a subsidiary of China Datang Corporation Ltd.

How the Company Makes Money

Datang Environment Industry Group generates revenue through multiple streams, primarily from the treatment and disposal of waste, including municipal solid waste and industrial waste. The company earns income by operating waste-to-energy facilities, where it converts waste into electricity, generating revenue from the sale of power to grid operators. Additionally, Datang engages in the design, construction, and operation of environmental infrastructure projects, often funded through government contracts and public-private partnerships. The company also benefits from the growing demand for environmental services and regulatory support for waste management initiatives, which contribute to its financial stability and growth.

Datang Environment Industry Group Co., Ltd. Class H Financial Statement Overview

Summary

Datang Environment Industry Group Co., Ltd. Class H shows a balanced financial performance with stable revenue growth, reasonable profitability, and strong cash flow generation. The company's moderate leverage and efficient use of equity contribute to its financial stability. However, the declining trend in total assets and equity warrants attention, as it may impact future growth potential.

Income Statement

The company has demonstrated steady revenue growth over recent years, with a 0.89% increase from 2023 to 2024. Its gross profit margin stands at 21.3%, and the net profit margin is 9.52% for 2024, indicating solid profitability. The EBIT margin of 12.27% and EBITDA margin of 23.64% suggest efficient cost management. However, a slight decline in EBITDA margin compared to previous years could be a concern.

Balance Sheet

The debt-to-equity ratio of 0.51 for 2024 reflects moderate leverage, providing a balance between debt and equity financing. The return on equity (ROE) is 7.12%, showing decent efficiency in using shareholders' equity to generate profits. The equity ratio stands at 50.26%, highlighting a stable financial structure. However, the decreasing trend in total assets and stockholders' equity over the years could pose long-term risks.

Cash Flow

The company's free cash flow growth rate from 2023 to 2024 is 16.81%, demonstrating strong cash generation capabilities. The operating cash flow to net income ratio of 3.13 indicates robust cash conversion efficiency. The free cash flow to net income ratio of 2.49 underscores a healthy cash position relative to profits. The consistent positive free cash flow over the years is a significant strength.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.71B	5.77B	5.72B	5.32B	5.29B	6.82B
Gross Profit	1.06B	1.23B	1.15B	789.42M	341.43M	1.17B
EBITDA	1.15B	1.36B	1.46B	1.12B	528.60M	1.38B
Net Income	423.38M	549.06M	522.38M	272.43M	-208.33M	302.87M
Balance Sheet
Total Assets	14.83B	15.35B	18.05B	18.35B	18.43B	20.18B
Cash, Cash Equivalents and Short-Term Investments	1.44B	994.75M	1.79B	872.20M	1.24B	1.53B
Total Debt	3.65B	3.92B	5.59B	5.64B	5.95B	6.07B
Total Liabilities	7.16B	7.84B	10.76B	11.45B	11.67B	12.84B
Stockholders Equity	7.85B	7.71B	7.47B	7.06B	6.88B	7.22B
Cash Flow
Free Cash Flow	2.17B	1.37B	1.17B	205.62M	583.47M	1.24B
Operating Cash Flow	2.45B	1.72B	1.81B	531.35M	987.03M	1.84B
Investing Cash Flow	-281.24M	-340.97M	-560.21M	-315.41M	-396.59M	-608.90M
Financing Cash Flow	-1.80B	-2.14B	-364.16M	-589.50M	-876.73M	-1.28B

Datang Environment Industry Group Co., Ltd. Class H Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.17
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1272, the sentiment is Negative. The current price of 1.17 is below the 20-day moving average (MA) of 1.19, below the 50-day MA of 1.20, and above the 200-day MA of 1.16, indicating a neutral trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 43.58 is Neutral, neither overbought nor oversold. The STOCH value of 55.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:1272.

Datang Environment Industry Group Co., Ltd. Class H Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
6805	79 Outperform	HK$2.47B	17.34	12.28%	9.96%	16.00%	32.03%
1065	78 Outperform	$9.85B	7.31	8.29%	4.61%	1.66%	-6.08%
1330	74 Outperform	HK$9.63B	9.65	8.62%	6.20%	-0.91%	18.25%
1272	72 Outperform	HK$3.56B	7.63	5.55%	7.61%	-4.41%	-34.31%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
0587	54 Neutral	HK$1.04B	-13.41	-2.39%	5.36%	-3.37%	-149.08%
0895	46 Neutral	$5.33B	-2.45	-27.89%	―	-3.21%	-34.90%

Datang Environment Industry Group Co., Ltd. Class H Corporate Events

Datang Environment Industry Group Announces Book Closure for 2025 Shareholders’ Meeting

Datang Environment Industry Group Co., Ltd. has announced the book closure period for its 2025 extraordinary shareholders’ meeting, which will be held on December 29, 2025. The register of members will be closed from December 22 to December 29, 2025, to determine shareholder entitlements for attending and voting at the meeting.

Datang Environment Industry Group Issues Fourth Tranche of 2025 Sci-Tech Innovation Bonds

Datang Environment Industry Group Co., Ltd. has successfully issued the fourth tranche of its 2025 sci-tech innovation bonds, raising RMB500 million. The proceeds from this issuance, underwritten by Shanghai Pudong Development Bank, will be used to repay interest-bearing liabilities, potentially strengthening the company’s financial position and operational flexibility.

Datang Environment Industry Group Plans Debt Financing to Enhance Market Position

Datang Environment Industry Group Co., Ltd. announced its plan to register and issue various debt financing instruments, including super short-term commercial paper, short-term commercial paper, and medium-term notes, with a registration limit expiring in March 2026. This strategic move aims to maintain financing channels, reduce costs, and meet capital requirements, potentially impacting the company’s financial stability and market competitiveness.