I'm LongbridgeAI, I can summarize articles.Guohai Securities maintains an "Overweight" rating for EB ENVIRONMENT, forecasting annual revenue of approximately HK$26 billion for 2026-2028. The company has consolidated the results of its revenue structure transformation, with the proportion of operational service revenue rising to 76%. As projects improve in quality and efficiency, cash flow is expected to improve. Net profit attributable to shareholders increased by 10% year-on-year in the first half, while dividends per share rose to 16.0 HK cents
According to Zhitong Finance APP, Guohai Securities released a research report maintaining an "Overweight" rating for EB ENVIRONMENT (00257). It forecasts the company's operating income for 2026-2028 to be HK$26.620 billion, HK$26.091 billion, and HK$25.912 billion respectively; net profit attributable to shareholders to be HK$3.909 billion, HK$4.016 billion, and HK$4.379 billion respectively; corresponding P/E ratios of 7.09x, 6.90x, and 6.33x respectively. The proportion of the company's operational revenue continues to rise, and cash flow is expected to continue improving as project operations enhance quality and efficiency.
Key Views from Guohai Securities:
In 1H 2026, the Proportion of Operational Service Revenue Rose to 76%, Consolidating the Results of Revenue Structure Transformation
In 1H 2026, the company achieved operating income of HK$14.181 billion, a year-on-year decrease of 1%; net profit attributable to shareholders was HK$2.431 billion, a year-on-year increase of 10%. In 1H 2026, the company's operational service revenue reached HK$10.755 billion, an 8% year-on-year increase, accounting for 76% of total revenue; construction service revenue was HK$853 million, a 54% year-on-year decrease, with its share dropping to 6%; financial income accounted for 18%.
Municipal Solid Waste Treatment Capacity Reached 163,100 Tonnes/Day, with Continuous Improvement in Operational Efficiency
As of June 30, 2026, the company's Environmental Energy and Green Environmental Protection sectors had implemented a total of 196 waste-to-energy projects, with a designed daily municipal solid waste treatment capacity of 163,100 tonnes (including entrusted operation capacity); the designed daily treatment capacity for kitchen and food waste was approximately 8,693 tonnes; and the designed daily treatment/supply capacity for water treatment and supply was approximately 7.6397 million cubic meters. In 1H 2026, in the Environmental Energy sector, the volume of waste received, electricity fed into the grid, and heat/steam supplied increased by approximately 2%, 2%, and 11% year-on-year, respectively; in the Environmental Water sector, sewage treatment volume and reclaimed water treatment volume increased by 6% and 3% year-on-year, respectively; in the Green Environmental Protection sector, the volume of waste received, biomass raw material processing, and heat/steam supplied increased by 2%, 4%, and 19% year-on-year, respectively.
Dividends Per Share Increased Year-on-Year
The company distributed a mid-term dividend of 16.0 HK cents per share in 2026, an increase from 15.0 HK cents per share in the same period of 2025. The payout ratio for the first half of 2026 (i.e., dividends as a percentage of earnings attributable to shareholders) reached 40%, a decrease of 2 percentage points from 42% in the same period of 2025.
Gross Margin Slightly Decreased Year-on-Year, While Net Margin Slightly Increased
In 1H 2026, the company's gross margin was 43.06%, a year-on-year decrease of 1.2 percentage points, mainly affected by the significant drop in construction service revenue; the company's net margin was 21.52%, a year-on-year increase of 2.08 percentage points.
Risk Warning
Progress in operational revenue growth falls short of expectations; risk of declining gross margins; progress in accounts receivable collection falls short of expectations; risk of declining dividend payout ratio; risk that the decline in construction revenue exceeds expectations; impairment risk.