The environmental industry entered the age of capital.
The environment industry has never been as popular as it is today. A few days ago, an environmental enterprise joint roadshow and 2016 industrial entrepreneurial innovation BBS (tenth) environment, attracted including CDB capital, everbright capital, citic securities, hundreds of investment institutions. With the release of ten "ten" "water" and "ten", the environmental industry policy is good and sustainable. Many market opportunities await capital excavation, the environment industry itself also urgently needs capital help.
The development of trapped
In fact, the environmental industry has not been favored by capital in the past, and it has a great relationship with the fuzzy and unclear positioning of industrial property. Although the environmental industry has existed long ago, due to the strong nature of environmental protection, the market is not fully developed and the industrial development space is not fully opened.
"The solution to the environmental problem, without the government, is not enough, but the government alone is not enough." Fu tao, chairman and chief partner of E20 environmental platform, said the government has been wavering in the market process of municipal utilities and environmental protection, creating a lot of uncertainty. Capital is invested in certainty. The uncertainty of the industry has shaken the company's strategy, resources and capital allocation and seriously affected the development of the industry.
"Environmental protection belongs to the local authority. In the absence of fiscal and taxation systems, there is little that can be done, and the lack of money is not likely to be environmentally friendly. According to fu tao, local governments or polluting enterprises do not take environmental protection seriously from the perspective of cost performance, resulting in the weakness of the environmental industry and the status quo of "fake industries".
In addition to the contradiction between public welfare and profitability, the lack of sustainable development capacity also seriously restricts the development of the industry. At present, the number of environmental enterprises in China is about 40,000 to 50,000, most of which are small enterprises. This is because early environmental enterprises are regional and get projects through specific relationships with local governments. This also makes it impossible for enterprises to expand outside the region and limited development space. The "small, scattered and disorderly" pattern of the environmental industry has affected the enterprises that have the advantages of technology and management, and also put off capital.
"It is impossible for an enterprise to develop in relation to information asymmetry and obtain long-term capital recognition. Without a sustainable business model, there would be no real environmental industry and no real connection to the capital markets. For example, many real estate companies in the early years, although there are billions of yuan of scale, a project is dissolved after the company is finished. There were more than 10,000 companies, and now there are only a few dozen.
The dance of capital
Along with the increasing demand of pollution control, and ecological civilization construction to the height of the "five one", environmental industry marketization process accelerate, tens of thousands of RMB one hundred million market cake to attract capital. Not only is the gezhouba group, China railway group, the large state began to transboundary environmental protection market layout, some from overcapacity in sectors such as steel, coal exit of social capital also targeted the environmental industry. The environmental industry entered the age of capital.
"The environmental industry has the characteristics of low income, low risk, long period and stable income. It has not been favored by the capital market that likes to make fast money, but it is now a gold asset. For example, between 8 and 9 per cent of the water and sewage treatment sector, and 20 to 30 years of long-term contracts, these BOT assets are now starting to rise. How to face the capital and use capital, most environmental companies need to make up for this lesson, fu said.
According to incomplete statistics, there were hundreds of environmental mergers and acquisitions in 2015, involving nearly 60 billion yuan. With tsinghua holdings co., LTD., a subsidiary of enlightenment, among them technology services group of four companies, buy Thornton group holds 29.8% stake, sander environment involved amount is about 7 billion yuan, the amount of mergers and acquisitions mainland environment market record.
The intervention of capital has made the environment industry stand on the dream of "tuyere", development acceleration; It also caused the former environmental industry practitioners to face the impact of the "barbarians" of cross-border capital. Zhao li jun, chairman of botian environment group co., LTD., believes that in the long run, the entry of big enterprises will intensify competition and integration of the industry and accelerate the improvement of industrial concentration. If small companies do not have a differentiated competitive advantage, it is difficult to change the dilemma.
The most obvious change is the repeated "breaking the bottom line" in PPP projects, raising fears of vicious competition and rattling the industry. For example, third-tier municipal waste incineration power generation projects are frequently priced at low prices, with a price tag of almost half a year. Recently, jiangsu high - mail project hit a new low: 26.5 yuan/ton. It is far from the conservative price of 60 yuan/ton to 80 yuan/ton calculated by many industry insiders.
Because of the new entrants into the environmental protection sector, technical strength, qualifications and credibility are difficult to investigate. These projects and more long-term contracts for more than 10 years of operation, the future will produce operating the effect is not up to standard or is it late to bargain and local governments, and even state such as contract is difficult to perform, remains to be seen. Thus, capital is a double-edged sword.
Change of industry
Over the past 20 years, the rapid development of our country has experienced from scratch environment infrastructure stage, the sewage treatment plant from dozens to now garbage disposal scale has dozens of times, one hundred times on growth. With the end of large-scale construction, the market is gradually saturated, and there is an emerging phenomenon of overcapacity and oversupply in the industry.
"Why are low price competition in municipal sewage, urban water supply and waste incineration? Because of the homogeneity of environmental public service, users cannot identify and differentiate the advantages and disadvantages of the service, plus the low price impact of cross-border capital, forcing the industry to change. According to fu tao, the environmental industry has moved from the original engineering and project era to the product and brand era.
The environmental industry needs the capital "catalyst" to move towards the era of product and brand. Whether BOT or PPP, environmental enterprises need to have strong financial strength; Listed financing is undoubtedly the best way to obtain low-cost funds. A number of excellent environmental enterprises, such as sander, pioneer, and green water source, have achieved rapid development through listing.
With the opening of the new third board market, more and more environmental enterprises have seen the dawn of the capital market. "Developing a multi-tiered capital market is a national strategy. The so-called multi-level, including the main board market, also includes the new third board market. Wu yu, chief analyst of new third board of huatai securities.
E20 environmental platform, as an environmental industry consulting service, is also a bridge between industry and capital. Executive director of E20 institute, Peking University institute of environmental E20 xue tao, vice President of the joint institute said: "we have 150 member enterprises, listed on the mainboard, 9% 14% listed on the new three board listed abroad, 9%; There are also 68 per cent of companies that do not go public and need capital and funds to plan their way through the capital markets.
"The environmental industry is highly policy-oriented and the industry is very fragmented. In 2015, more than 10 billion yuan of revenue came from the company, which reached 11.4 billion yuan. The first is 7 billion yuan, and the green water source is 5.2 billion yuan. Huang jian, head of PE investment at China foreign economic and trade trust co., LTD., believes that there is still room for development of the environmental industry.