Important Statement,This analysis is based on publicly available information and industry research models. The data may not accurately reflect reality and does not constitute investment advice. I am happy to promote this stock,how to promote it, who promotes it is not important, what matters is whether you believe it and to what extent.
1. Industry Outlook: Carbon Neutrality + AI Reshaping Environmental Monitoring Sector
Strong Policy Stimulus:The expansion of China’s carbon market to industries such as cement and steel (with an additional 2000 emission control enterprises in 2024) will directly drive the demand for CEMS (Continuous Emission Monitoring Systems). According to the Ministry of Ecology and Environment’s plan, the market size for environmental monitoring equipment is expected to exceed 150 billion yuan by 2025, with a compound annual growth rate of over 20%. Xuedilong, as a participant in the formulation of national standards for carbon emission monitoring, has significant technical barriers.
AI + Environmental Protection Breakthrough:After OpenAI releases the Sora model in 2024, AI multimodal technology will accelerate its penetration into the environmental protection field. Xuedilong’s collaboration with Huawei Cloud on the “AI Smart Environmental Protection Brain” has been implemented in multiple industrial parks, improving the efficiency of monitoring data anomaly recognition by 40% through algorithm optimization, and reducing operational costs by 25%. The gross margin of such solutions (as reported, reaching 58%) far exceeds that of traditional equipment business.
New Growth Drivers: VOCs and Heavy Metal Monitoring:In 2024, the “Air Quality Improvement Action Plan” will include VOCs (Volatile Organic Compounds) monitoring in its assessment, with a market size expected to reach 30 billion yuan. Xuedilong’s independently developed VOCs online monitoring system (revenue share increasing from 12% in 2022 to 21% in 2024) has become the second growth curve.
2. Analysis of Xuedilong’s Core Competitiveness
Technical Moat:
-
Leading Position in Carbon Monitoring:Participated in drafting the “Technical Specifications for Carbon Emission Monitoring of Fixed Pollution Sources,” with a market share of over 35% for its laser gas analyzers.
-
Successful AI Transformation:In 2024, R&D expenses increased to 180 million yuan (accounting for 9% of revenue), and the AI algorithm team expanded to over 100 people, having obtained 7 related patents.
Business Model Upgrade:Transitioning from “selling equipment” to “data service provider,” with revenue from the smart environmental protection platform business growing by 72% in 2024, subscription revenue accounting for 15% (up from only 5% in 2022). According to Tonghuashun data, the customer renewal rate for this business is 91%, significantly improving cash flow stability.
Ability to Realize Policy Dividends:In 2024, won the “National Carbon Monitoring and Assessment Pilot” project (amounting to 230 million yuan), and became one of the first Chinese monitoring equipment suppliers certified for the EU Carbon Border Adjustment Mechanism (CBAM), showing significant international breakthroughs.
3. Financial Data Analysis: Opportunities in Danger
Cash Flow Resilience Exceeds Expectations
-
Net operating cash flow decreased by only 3.2% (far better than the decline in net profit), mainly due to the advance payment model of smart operation and maintenance services (contract liabilities increased by 26%).
-
Days sales outstanding improved to 102 days (135 days in 2023), indicating the company is actively reducing low-quality projects.
Impairment Risk Fully Released
-
In 2024, a provision for inventory impairment of 120 million yuan was made (mainly for traditional equipment inventory), with inventory size decreasing by 29% year-on-year, laying the foundation for a leaner operation in 2025.
4. Investment Recommendations: Cautious in the Short Term, Strategic in the Long Term
Core Logic Correction:The decline in performance reflects a phase adjustment in the industry rather than a loss of company competitiveness. The current stock price has reflected pessimistic expectations (PB 2.1x, below the 5-year average -1 standard deviation), but two key signals need to be awaited:
2025 Q2 Carbon Monitoring Orders Implementation (verification of policy enforcement);
AI Operation and Maintenance Service Revenue Share Exceeding 25% (valuation switching opportunity).
Summary: Xuedilong is at the intersection of clearing traditional business and the explosion of emerging business. The decline in performance in 2024 is actually the result of proactive strategic adjustments. The current valuation has reflected short-term pessimistic expectations, while the mandatory installation cycle for carbon monitoring and the commercialization of AI operation and maintenance will drive a double boost.
5. Technical AnalysisThe stock price has oscillated in a large box between 5-10 yuan for 7 years. As the saying goes, the longer the horizontal movement, the higher the vertical movement. According to the expectation of the main rising wave, reaching 15 yuan is just a matter of time.
Before effectively breaking through 8.8 yuan, it will still be mainly oscillating. The daily moving averages are converging, and there is a possibility of an outbreak at any time. Long-term strategic positions can be gradually built by buying on dips around 6.5.My initial position was 5%, with a reference transaction price of 6.51.2025 Stock Pool and Individual Stock Logic AnalysisNew Year Long-term Investment Plan (with 2025 Wealth Code)Collection of Individual Stock Logic Analyses————-Universal Divider————Master of Leeks‘s Investment DiaryIf this content is helpful to you, please share and like it.