研究报告全文：MN9Feb2023CMBInternationalGlobalMarketsEquityResearchCompanyUpdateTianLunGas1600HKAARapidrecoveryinClsgassalescountynewenergybusinesscontinuestoheatupTargetPriceHK655WehadacompanyvisittoTLGinHenanCriticaltakeawaysareasfollow1ClsgassaleshasrecoveredrapidlysinceDec2022thankstotherelaxedepidemicPreviousTPHK487controls2dollarmarginscontinuedtoimproveTLGhasstrongbelieftoreachitsUpDownside33goalofRMB043cbminFY22as3Q22dollarmarginachievedRMB05cbmandCurrentPriceHK4902H22dollarmarginwentbacktoasimilarlevelofpreviousyear3countyhouseholdphotovoltaicbusinessdevelopedslowerthanexpectedbutitstillshowedagreatChinaEnergyChinaGasbusinessgrowthpotentialgivenTLGssolidruralresidentbaseandadvancedgas-electricsynergymodeland4continuedsharebuybackrevealsthemanagementssolidconfidenceWeliftourTPtoHK655basedonrollover8x23EPEandMeganXiaCESGArollingEPSfor23EreflectingClspositivegassalesrecoveryrobustvalue-85237610836addedbusinessandgreatgrowthpotentialofcountyenergyMaintainBUYmeganxiacmbicomhkratingClgassaleshasshownarapidrecoverysinceDec2022andpotentiallyJackBaiCFAsuppressedgasdemandforCImayfurtherreleasein2023AsTLGsCl85239000835segmentaccountsformorethan60ofitstotalgassalesvolumeClsgasdemandjackbaicmbicomhkrecoveryisvitaltoTLGWeinvestigatedXuchangaspecificareaofTianLunGasthesecondareathatownsthecitygasfranchiseaftertheHebiareaInparticularwevisitedWandaPlazaandfoundoutitsinnershopsoperationshaverecoveredsinceepidemiccontrolrelaxedinDec2022Giventherelaxationoftheepidemiccontrolspolicystartedtodriveaneconomicrevivalinlate2022weexpectthegrowthrateofClsgassalesvolumetoreachdoubledigitsin2023InadditionasabetterStockDataeconomymayalsostrengthenenterprisesabilitytoacceptrisinggaspricestheMktCapHKmn49090potentiallysuppressedClgasdemandduetohighergaspriceswillfurtherreleaseAvg3mthstoHKmn38DollarmargincontinuestoimproveAsTLGimplementedactiveprice-cross52wHighLowHK971281measuresanddiversifieditsgassourcetheGroupsdollarmarginimprovedtoTotalIssuedSharesmn9828SourceFactSetaroundRMB05cbmin3Q22andthedollarmarginin2H22wentbacktoasimilarleveltopreviousyearsInadditionwebelieveTLGsdollarmargincanbefurtherShareholdingStructureimprovedasTLGsClsegmentaccountsformorethan60ofitstotalgassalesTianLunGroup503volumeandClsegmenttypicallytakeslesstimeonprice-crossmeasuresthantheFreeFloat296residentialsegmentThereforewepredictedThusweestimatedTLGcanreachedSourceHKExRMB043cbmin2022asitsguidanceandimprovedtoRMB048cbmin2023GreatdevelopmentpotentialforTLGsruralhouseholdPVbusinesswiththeSharePerformancegas-electricsynergymodelDuringourfieldtripitisrevealedthatTLGhasobviousAbsoluteRelativeregionaladvantagesonruralhouseholdPVconstruction12mnhouseholdsrural1-mth250163gasificationusersandamaturelocalizedoperationteam2greatlightingconditions3-mth6841923ruralusershaveasolidwillingnesstorenttheroofs4Gas-electricSynergyModel6-mth321205bringsmutualbenefitstopartnersandenablesTLGtoinvestinlightassetswithgreatSourceFactSetflexibilityAlthoughTLGsphotovoltaicbusinessexpansionwaspartiallyaffectedbyepidemiccontrolsTLGhastargeted64000to65000ruraluserstoconstructrooftop12-mthPricePerformancephotovoltaicsasplannedin2022Themorerelatedrevenueisexpectedtodeliverin2023WeraisedTPfromHK487toHK655byrollingEPSofRMB072shareinFY23and8x23EPEcloseto1SDof3-yearhistavgPEMaintainBUYratingAtpresentTLGistradingataround6x2023forwardPEGivenClspositivegassalesrecoveryin2023betterdollarmarginsolidvalue-addedbusinessandcountyenergyspotentialgrowthspacewethinkthevaluationisdemandingInadditiontheGroupsmanagementcontinuedsharebuybackimplyingastrongbeliefintheSourceFactSetcompanysbusinessMaintainBUYratingEarningsSummaryYE31DecFY20AFY21AFY22EFY23EFY24ERevenueRMBmn64407650770984959364NetprofitRMBmn1043510007551072538854EPSReportedRMB104100056072088YoYgrowthna39440283218ConsensusEPSRMBnana059075088PEx5241725748PBx1212080706Payoutratio2628282830ROEna202102125138SourceCompanydataBloombergCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE1MOREREPORTSFROMBLOOMBERGRESPCMBRGOORhttpwwwcmbicomhk9Feb2023TLGsruralrooftopPVbusinessAccordingtoTLGsestimationasthenationalgoalofpromotingrooftopPVinwholecountriesrequired20ofruralusableroofsfordistributedPVHenanaccumulatedtotalruralroofareaof1300mnmAsTLGhasaround2mnruralhouseholdusersweestimatedTLGhasatotalruralroofareaofroughly200-300mnmbasedontheassumptionofeachruralusersrooftopareaoccupiedabout10-15mThereforewepredictedthatTLGhasoutstandingruralrooftopresourcesandaccountsforapproximately7oftotalruralroofPVareainHenanassumedruralPVinstalledrateasaround2forreferenceFigure12016-2021newPVPowermarketinHenanMarketsizeofdistributedphotovoltaicinHenan-exceedingRMB200bnSourceCompanydataCMBIGMestimatesInadditionin1H22TLGwasguidedtodevelopatleast100000newusersyeareachnewuserestimatedtoconstructaround3KWThusTLGplanstoconstruct300MW1000MW1500MWand2000MWin2022-2025AsTLGguidedthegrossprofitofEPCconstructionwasRMB015-025WTLGexpecttohaveatotalgrossprofitofnearlyRMB45mn150mn225mnand300mninPVconstructionduring2022-2025ForPVoperationandmaintenanceTLGplanstoexpanditsscaleto2000MW6000MM12000MWand20000MWfrom2022to2025BasedonthenetprofitofRMB001wperyearTLGwillearnRMB20mn60mn120mnand200mnnetprofitofPVoperationandmaintenancein2022-2025BesidesTLGwillalsoreceiveadividendfromthepowerstationinlong-termFigure2TLGsruralrooftopPVbusinesssprofitcomponentsSourceCompanydataCMBIGMestimatesConsideringtheaboveTLGsrooftopphotovoltaicbusinessshowsstrongprofitabilityandsignificantgrowthpotentialsPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE29Feb2023HoweverasTLGsruralPVconstructionwaspartiallyaffectedbyepidemiccontrolslastyeartheconstructionprogressin2022maybeslowerthanexpectedTLGcooperatedwithSPICandJinKotoconstructruralrooftopPVwithauniqueGas-electricSynergyModelInparticularTLGactedasahouseholdPVCarrierinchargeofresourcesdevelopmentEPCconstructionandPhotovoltaicOMInourview2022-2023wastheexplorephasesofrooftopPVconstructionforTLGasGas-electricSynergyModelmaytaketimetopracticeandimproveThusstableandspecificrevenueaspreviouslyguidedmaypostponetodeliverinalaterfewyearsFigure3TLGsruralrooftopPVconstructionvolumeandmaintenancescalein2022-2025SourceCompanydataCMBIGMestimatesValuationWeliftTPtoHK655andmaintainBUYratingAscoal-to-gasslowsdownandthecompanyentersintocountynewenergybusinessdevelopmentweadjustednewly-addedruralresidentusersgrowthto80000in2023Eand60000in2024EBesidesasClsgasdemandwasaffectedbyepidemiccontrolsin2022wealsolowerednumberofnewly-addedCluserto3400in2022EThusweslightlyadjustednetprofitin2022-24Eby-1-3and-5WeraisedTPfromHK487basedon75xPEforFY22EtoHK655byrollingEPSofRMB072shareinFY23and8x23EPEcloseto1SDof3-yearhistavgPEAtpresentTLGistradingataround6x2023forwardPEGivenClspositivegassalesrecoveryin2023betterdollarmarginsolidvalue-addedbusinessandcountyenergyspotentialgrowthspacewethinkthevaluationisdemandingvspeersvaluationofaround8xPEInadditiontheGroupsmanagementcontinuedsharebuybackimplyingastrongbeliefinthecompanysbusinessMaintainBUYratingFigure4PeerstableClosingMktcapEPS22-24EPERPBRPriceCompanyTickerHKHKmn22E23E24ECAGR22E23E24E22E23E24ETIANLUNGASHOL1600HK490494913059075088225720568480070063058ENNENERGY2688HK1157013086674691759844105144613181184277243216CHINAGASHOLDIN384HK12486789539153127144-30818986869104099092CHINARESGAS1193HK33907844504274303339111123511211001175161148TOWNGASSMARTEN1083HK3881264386043045053108907855739052053051KUNLUNENERGY135HK624540309207107607843756713695078073069Average908173090908SourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE39Feb2023Figure5Revisiontable3YrModelOldNewChange2022E2023E2024E2022E2023E2024E2022E2023E2024EKeyassumptionsTotalgassalesvolumemcbm215324432759213424162723-09-11-13Residential525575629525573622-01-03-11CI111612961491109812711463-17-19-19Vehicle8791968791960004-01Wholesale425480543425480543000100GasconnectionconstructionservicesHouseholdsResidential27839629231630693127839627004426194300-76-147Township100000120000130000100000120000130000000000CI400040004000340038003900-150-50-25FinancialsestimationRevenueRmbmn776786359583770984959364-07-16-23NetIncomeRmbmn555751933551725885-07-34-51EPSRmb05607409205607208801-28-48SourceCompanydataCMBIGMestimatesPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE49Feb2023FinancialSummaryINCOMESTATEMENT2020A2021A2022E2023E2024EYE31DecRMBmnRevenue64407650770984959364Costofgoodssold46545871640169157489Others00000Grossprofit17861779130815811874Operatingexpenses253293295325359Sellingexpense5975768492Adminexpense193218219242266Others00000Operatingprofit17031601102512681529Otherincome1015888Othergainslosses16099555AdjustedEBITDA140412676548561072Depreciation164184215250288Otheramortisation136150156163169EBIT17031601102512681529Interestincome118131322Interestexpense250236332344355NetInterestincomeexpense239228319331333Otherincomeexpense461038420Pre-taxprofit141813637449801196Incometax355335183241294Aftertaxprofit10641028562739903Minorityinterest2027111417Netprofit10441001551725885Corenetprofit895915551725885BALANCESHEET2020A2021A2022E2023E2024EYE31DecRMBmnCurrentassets43635215549658677518Cashequivalents1640101597610562393Restrictedcash25177250250250Accountreceivables13931408158617481927Inventories116155121123125FinancialassetsatFVTPL2746272727Othercurrentassets11622415253526622795Non-currentassets85569890103331104910660PPE30353519434849625624Right-of-useassets268272298312326Deferredincometax2727333434Intangibles40875097431443584396FinancialassetsatFVTPL6273797979Othernon-currentassets107790212601303200Totalassets1291815105158281691618177Currentliabilities45564555474550745445Short-termborrowings22952058195220172087Accountpayables13641419160017291872Othercurrentliabilities436483568672797Leaseliabilities43344Contractliabilities458592622653685Accruedexpenses00000Non-currentliabilities33815021521754285656Long-termborrowings27704248438345294686Bondpayables00000Deferredincome1413131313Othernon-currentliabilities597761821887958Totalliabilities7938957699621050211102Sharecapital88888Capitalsurplus817528528528528Retainedearnings33174145441848795435Otherreserves556536591663752Totalshareholdersequity46995218554560796724Minorityinterest281310321335352Totalequityandliabilities1291815105158281691618178PLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE59Feb2023CASHFLOW2020A2021A2022E2023E2024EYE31DecRMBmnOperatingProfitbeforetaxation141813637449801196Depreciationamortization299334372412457Taxpaid228134417297Changeinworkingcapital1551100196135141Others564731514Netcashfromoperations139041587611711400InvestingCapitalexpenditure185484830614662Others6801331122497612Netcashfrominvesting8651815707111150FinancingDividendpaid249273224191241Netborrowings128124129211228Proceedsfromshareissues21207000Others1690000Netcashfromfinancing2307611952014NetchangeincashCashatthebeginningoftheyear1350164010029761056Exchangedifference50000Others29563826801337Cashattheendoftheyear1640100297610562393GROWTH2020A2021A2022E2023E2024EYE31DecRevenue1718808102102Grossprofit4804265209186Operatingprofit18760360237205EBIT18760360237205Netprofit32241449316221PROFITABILITY2020A2021A2022E2023E2024EYE31DecGrossprofitmargin277233170186200Operatingmargin265209133149163ReturnonequityROEna202102125138GEARINGLIQUIDITYACTIVITIES2020A2021A2022E2023E2024EYE31DecCurrentratiox1011121214Receivableturnoverdays834668709716716Inventoryturnoverdays9165655248Payableturnoverdays1006865861879877VALUATION2020A2021A2022E2023E2024EYE31DecPE5241725748PB1212080706SourceCompanydataCMBIGMestimatesNoteThecalculationofnetcashincludesfinancialassetsPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE69Feb2023DisclosuresDisclaimersAnalystCertificationTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportinwholeorinpartcertifiesthatwithrespecttothesecuritiesorissuerthattheanalystcoveredinthisreport1alloftheviewsexpressedaccuratelyreflecthisorherpersonalviewsaboutthesubjectsecuritiesorissuerand2nopartofhisorhercompensationwasisorwillbedirectlyorindirectlyrelatedtothespecificviewsexpressedbythatanalystinthisreportBesidestheanalystconfirmsthatneithertheanalystnorhisherassociatesasdefinedinthecodeofconductissuedbyTheHongKongSecuritiesandFuturesCommission1havedealtinortradedinthestockscoveredinthisresearchreportwithin30calendardayspriortothedateofissueofthisreport2willdealinortradeinthestockscoveredinthisresearchreport3businessdaysafterthedateofissueofthisreport3serveasanofficerofanyoftheHongKonglistedcompaniescoveredinthisreportand4haveanyfinancialinterestsintheHongKonglistedcompaniescoveredinthisreportCMBIGMRatingsBUYStockwithpotentialreturnofover15overnext12monthsHOLDStockwithpotentialreturnof15to-10overnext12monthsSELLStockwithpotentiallossofover10overnext12monthsNOTRATEDStockisnotratedbyCMBIGMOUTPERFORMIndustryexpectedtooutperformtherelevantbroadmarketbenchmarkovernext12monthsMARKET-PERFORMIndustryexpectedtoperformin-linewiththerelevantbroadmarketbenchmarkovernext12monthsUNDERPERFORMIndustryexpectedtounderperformtherelevantbroadmarketbenchmarkovernext12monthsCMBInternationalGlobalMarketsLimitedAddress45FChampionTower3GardenRoadHongKongTel85239000888Fax85239000800CMBInternationalGlobalMarketsLimitedCMBIGMisawhollyownedsubsidiaryofCMBInternationalCapitalCorporationLimitedawhollyownedsubsidiaryofChinaMerchantsBankImportantDisclosuresTherearerisksinvolvedintransactinginanysecuritiesTheinformationcontainedinthisreportmaynotbesuitableforthepurposesofallinvestorsCMBIGMdoesnotprovideindividuallytailoredinvestmentadviceThisreporthasbeenpreparedwithoutregardtotheindividualinvestmentobjectivesfinancialpositionorspecialrequirementsPastperformancehasnoindicationoffutureperformanceandactualeventsmaydiffermateriallyfromthatwhichiscontainedinthereportThevalueofandreturnsfromanyinvestmentsareuncertainandarenotguaranteedandmayfluctuateasaresultoftheirdependenceontheperformanceofunderlyingassetsorothervariablemarketfactorsCMBIGMrecommendsthatinvestorsshouldindependentlyevaluateparticularinvestmentsandstrategiesandencouragesinvestorstoconsultwithaprofessionalfinancialadvisorinordertomaketheirowninvestmentdecisionsThisreportoranyinformationcontainedhereinhavebeenpreparedbytheCMBIGMsolelyforthepurposeofsupplyinginformationtotheclientsofCMBIGMoritsaffiliatestowhomitisdistributedThisreportisnotandshouldnotbeconstruedasanofferorsolicitationtobuyorsellanysecurityoranyinterestinsecuritiesorenterintoanytransactionNeitherCMBIGMnoranyofitsaffiliatesshareholdersagentsconsultantsdirectorsofficersoremployeesshallbeliableforanylossdamageorexpensewhatsoeverwhetherdirectorconsequentialincurredinrelyingontheinformationcontainedinthisreportAnyonemakinguseoftheinformationcontainedinthisreportdoessoentirelyattheirownriskTheinformationandcontentscontainedinthisreportarebasedontheanalysesandinterpretationsofinformationbelievedtobepubliclyavailableandreliableCMBIGMhasexertedeveryeffortinitscapacitytoensurebutnottoguaranteetheiraccuracycompletenesstimelinessorcorrectnessCMBIGMprovidestheinformationadvicesandforecastsonanASISbasisTheinformationandcontentsaresubjecttochangewithoutnoticeCMBIGMmayissueotherpublicationshavinginformationandorconclusionsdifferentfromthisreportThesepublicationsreflectdifferentassumptionpoint-of-viewandanalyticalmethodswhencompilingCMBIGMmaymakeinvestmentdecisionsortakeproprietarypositionsthatareinconsistentwiththerecommendationsorviewsinthisreportCMBIGMmayhaveapositionmakemarketsoractasprincipalorengageintransactionsinsecuritiesofcompaniesreferredtointhisreportforitselfandoronbehalfofitsclientsfromtimetotimeInvestorsshouldassumethatCMBIGMdoesorseekstohaveinvestmentbankingorotherbusinessrelationshipswiththecompaniesinthisreportAsaresultrecipientsshouldbeawarethatCMBIGMmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreportandCMBISwillnotassumeanyresponsibilityinrespectthereofThisreportisfortheuseofintendedrecipientsonlyandthispublicationmaynotbereproducedreprintedsoldredistributedorpublishedinwholeorinpartforanypurposewithoutpriorwrittenconsentofCMBIGMAdditionalinformationonrecommendedsecuritiesisavailableuponrequestForrecipientsofthisdocumentintheUnitedKingdomThisreporthasbeenprovidedonlytopersonsIfallingwithinArticle195oftheFinancialServicesandMarketsAct2000FinancialPromotionOrder2005asamendedfromtimetotimeTheOrderorIIarepersonsfallingwithinArticle492atodHighNetWorthCompaniesUnincorporatedAssociationsetcoftheOrderandmaynotbeprovidedtoanyotherpersonwithoutthepriorwrittenconsentofCMBIGMForrecipientsofthisdocumentintheUnitedStatesCMBIGMisnotaregisteredbroker-dealerintheUnitedStatesAsaresultCMBIGMisnotsubjecttoUSrulesregardingthepreparationofresearchreportsandtheindependenceofresearchanalystsTheresearchanalystwhoisprimaryresponsibleforthecontentofthisresearchreportisnotregisteredorqualifiedasaresearchanalystwiththeFinancialIndustryRegulatoryAuthorityFINRATheanalystisnotsubjecttoapplicablerestrictionsunderFINRARulesintendedtoensurethattheanalystisnotaffectedbypotentialconflictsofinterestthatcouldbearuponthereliabilityoftheresearchreportThisreportisintendedfordistributionintheUnitedStatessolelytomajorUSinstitutionalinvestorsasdefinedinRule15a-6undertheUSSecuritiesExchangeActof1934asamendedandmaynotbefurnishedtoanyotherpersonintheUnitedStatesEachmajorUSinstitutionalinvestorthatreceivesacopyofthisreportbyitsacceptancehereofrepresentsandagreesthatitshallnotdistributeorprovidethisreporttoanyotherpersonAnyUSrecipientofthisreportwishingtoeffectanytransactiontobuyorsellsecuritiesbasedontheinformationprovidedinthisreportshoulddosoonlythroughaUS-registeredbroker-dealerForrecipientsofthisdocumentinSingaporeThisreportisdistributedinSingaporebyCMBISingaporePteLimitedCMBISGCompanyRegnNo201731928DanExemptFinancialAdviserasdefinedintheFinancialAdvisersActCap110ofSingaporeandregulatedbytheMonetaryAuthorityofSingaporeCMBISGmaydistributereportsproducedbyitsrespectiveforeignentitiesaffiliatesorotherforeignresearchhousespursuanttoanarrangementunderRegulation32CoftheFinancialAdvisersRegulationsWherethereportisdistributedinSingaporetoapersonwhoisnotanAccreditedInvestorExpertInvestororanInstitutionalInvestorasdefinedintheSecuritiesandFuturesActCap289ofSingaporeCMBISGacceptslegalresponsibilityforthecontentsofthereporttosuchpersonsonlytotheextentrequiredbylawSingaporerecipientsshouldcontactCMBISGat6563504400formattersarisingfromorinconnectionwiththereportPLEASEREADTHEANALYSTCERTIFICATIONANDIMPORTANTDISCLOSURESONLASTPAGE7