Shen Wan Hongyuan: Jinjing Xinneng (01783) established an inflection point in the transformation of the dual main business, created a new growth curve on the computing power circuit, and was first given a “buy” rating

Zhitong Finance App learned that Shen Wan Hongyuan released a research report saying that Jin Jing Xinneng (01783) has completed the transformation from a traditional construction contractor to a circular economy+computing power dual main business platform: reverse recycling of industrial metals in the US provides definitive cash flow (operators' removal of copper cables brings continuous supply, fixed contracts lock in costs, and high metal prices increase price differences). Power battery recycling in Hong Kong, China's first licensed processing facility with scarce production capacity. The decommissioned battery volume is imminent, and the “service fee+resource” dual-wheel drive is stable and stable. Resilience: Acquiring YV Cloud to break into AI computing power High demand in the leasing industry resonates with rising supply-side energy consumption and license thresholds. Performance thresholds and payment deferral mechanisms provide a safety cushion for premium transactions. The three major businesses are relaying one after another, and the performance growth path is clear. The bank believes that the total reasonable valuation of the company's resource recycling and computing power services business could reach HK$25.827 billion, with room for an increase of 94.7% compared to the current total market value of HK$13.262 billion. First coverage, giving a “buy” rating.

Shen Wan Hongyuan's main views are as follows:

Establishing an inflection point for business transformation: building a foundation for a circular economy and boosting computing power services. The predecessor of Jinjing Xinneng was founded in 1985 and was mainly involved in construction projects in Hong Kong, China in the early days. Since 2022, the company has entered the hierarchical utilization and recycling of power batteries and the reverse supply chain management business in the US through mergers and acquisitions. As the share of high-margin circular economy businesses increased, the company achieved net profit of HK$61 million to mother in FY2025/26, which was corrected for the first time since the business transformation. In June 2026, the company promoted the acquisition of YV CLOUD Limited and Shanghai Youfu Cloud Computing, entered AIDC and AI computing power services, and built a multi-business system of “infrastructure engineering+resource recycling+computing power leasing”.

Renewable resources business: The basic market is stable and the development prospects are clear. The withdrawal of copper cables from the US network is progressing at an accelerated pace, and demand for reverse recycling has entered a stage of continuous release. Telecom giants such as AT&T and Verizon are accelerating the migration to wireless communications and fiber-optic networks, which is an irreversible trend. The company is deeply tied to leading customers such as AT&T, Verizon, and Amazon, and there is plenty of room to increase the penetration rate of existing customers. The company uses fixed-term contracts to lock in procurement costs at agreed prices. After dismantling, high-purity copper and aluminum are sold at market prices. Under high copper prices, rising metal prices directly increase recycling price differences, and have both profit stability and flexibility.

Power battery recycling business: Waste batteries are being released soon, and scarce licenses are building a moat. As of the end of May 2026, Hong Kong, China had approximately 178,000 electric vehicles, an increase of nearly tenfold over 2020. The number of private cars is expected to exceed 500,000 after full electrification by 2035. The rise in the number of batteries has brought about a large demand for recycling used batteries. It is expected that recycling of used batteries will accelerate from 2026. As a general rule, hazardous waste cannot be exported to non-OECD regions such as mainland China and Southeast Asia, and local compliance production capacity is highly scarce. The company's Tuen Mun EcoPark plant is the first power battery treatment facility in Hong Kong. It obtained a chemical waste disposal license from the Hong Kong Environmental Protection Department in June 2026 and was put into operation in the same month. The design capacity is 10,000 tons per year. Currently, production capacity is climbing before the peak of power battery decommissioning. While processing service fees guarantee stable income, black powder resource sales further contributed to flexibility and continued to contribute incremental performance to the company.

Computing power service business: The acquisition of YV Cloud entered the AI computing power circuit and created a new growth curve. In recent years, the scale of intelligent computing power in China has grown rapidly. Major downstream Internet companies have greatly increased capital expenditure in the computing power sector, and the AIGC sector is extremely booming. In June 2026, the company began the acquisition of YV CLOUD Limited and the operating company Shanghai Youfu Cloud Computing Co., Ltd., and officially entered the computing power service circuit. As one of the earliest NVIDIA Cloud Partners in China, the target company has advantages in GPU allocation priority and original factory pricing. Jinjing Xinneng simultaneously began expanding its computing power assets. Currently, it has completed the procurement of more than 500 Nvidia high-performance GPU servers. It is optimistic that the expansion of computing power will inject new momentum into the company's rapid growth.

Profit forecast and valuation: The bank predicts FY2026/27‑FY2028/29 revenue of HK$70.68, 100.44 and HK$12.333 billion, net profit to mother of HK$3.89, 7.15, HK$1,036 billion, EPS of 0.13, 0.24 and HK$0.34 per share, respectively, and corresponding PE of 34x, 19x and 13x, respectively. Considering the large differences in resource recycling and computing power service business models, the bank used segmented valuation of the company. Since FY2028/29, the performance stability of the company's resource recycling business increased rapidly after production capacity climbed rapidly, and the computing power business has gone through a cultivation period, and valuations based on this fiscal year's results can better reflect the company's true value level. The bank expects the FY2028/29 resource recycling business to contribute approximately HK$579 million to net profit, with a valuation of 13xPE, corresponding to a market value of HK$7.524 billion. The computing power service business contributed approximately HK$458 million, with a valuation of 40xPE, corresponding to a market value of HK$18.303 billion, with a total reasonable valuation of HK$25.827 billion, with room for an increase of 94.7% over the current total market value. First coverage, giving a “buy” rating.