It is estimated that 5 trillion yuan of environmental assets will enter the market, of which 1/3 of the assets will enter this field by investment, and the other 2/3 will be invested by the government. 1/3 of the assets entering the market are divided into two parts, one is regional heavy asset companies and integrated service companies, and the other 1 trillion yuan is controlled by investment groups.

The future trend of investment groups is large-scale. No scale of more than 30 billion yuan will not become a member of the China Environmental Heavy Assets Group.

As a regional integrated service provider, there are now nearly 10 listed companies in the water industry, and there should be 70 to 80 companies in the technology segment, which will lead the industry in the segment, and these companies are mainly concentrated on the ChiNext And small and medium boards.

With the continuous advancement of water pollution control and the development of the environmental protection industry, my country's water market is undergoing unprecedented changes, and water companies are also facing huge opportunities and challenges. What kind of mentality should the water industry in the public service sector have? How does an enterprise determine its development direction based on its own characteristics? What kind of pattern will the industry take in the future? At the 2014 (12th) Water Industry Strategy Forum held not long ago, Fu Tao, director of the Water Industry Policy Research Center of Tsinghua University, expressed his views.

Strategic cooperation will become the theme of the water market

Specialized division of labor promotes enterprise cooperation, cross-border mergers and acquisitions need to be cautious

In response to the changes in the water market in recent years, Fu Tao believes that the water market from 2003 to 2010 can be called the "spring and autumn era" and it is also an era of strategic cooperation. "At that time, water companies tied up with each other through project investment. The past five years have been the "Warring States Period" of the water market. M&A is the theme of the market, including inter-bank M&A, cross-border M&A, and capital-induced M&A. The market has already taken shape. Under the conditions, water companies want to develop quickly often through mergers and acquisitions."

"However, mergers and acquisitions should no longer be the subject of the water market in the future." Fu Tao pointed out that now China's water industry should return to the era of strategic cooperation. He explained that as environmental protection requirements are getting higher and higher, enterprises are taking more and more risks. For example, if the sewage treatment plant does not handle the sewage well, the relevant departments will hold the responsible person for life. The continuous strict environmental supervision and the implementation of accountability will also give birth to cooperation between water companies. Whether it is a company that is good at capital investment, or a company that is good at engineering project construction, or a water company that focuses on technology, they will get their own development space.

"The increase in environmental service requirements calls for a specialized division of labor. This division of labor will inevitably lead to cooperation between enterprises. In the era of integrated technical services, many subdivided companies will form strategic partnerships. The water market in the next five years should be A market with strategic cooperation as the main line." He said.

At the same time, Fu Tao said that although mergers and acquisitions will still exist in the future, more of them should be inter-industry mergers and acquisitions, and enterprises should be cautious if they want to conduct cross-border mergers and acquisitions.

In what ways do water companies need to cooperate to achieve substantial development? Fu Tao analyzed this: In the past 10 years, water projects have been the focus of competition in the water industry. In his opinion, project-centric is not a good company. "Although many large companies have many projects, they are actually'small companies'." When the water industry enters the era of strategic cooperation, the focus of water companies will no longer be dependent projects, and large companies are not simply superimposed on similar projects. Big "small company" formed.

Fu Tao pointed out that the current cooperation in the water market is not only the cooperation of water projects, but also the cooperation between enterprises, which is the in-depth cooperation of enterprises on the extension of the industrial chain. This has also led the water industry to enter the company era from the project era.

He believes that the impact of socialization makes company brand and company value higher than simple projects. The fastest-growing companies today are companies that are proficient in strategic cooperation. The focus of mergers and acquisitions and cooperation is no longer simple project cooperation, but inter-company mergers and acquisitions and strategic cooperation between enterprises.

Technology weight is expected to exceed capital weight

The water industry will pursue the parallel goal of resource utilization and harmlessness, and the technical content will gradually increase

By sorting out the development context of the water industry, Fu Tao pointed out that in the past, the water industry was a public service system centered on harmlessness and service. Simply speaking, the main business of water companies was water supply and sewage treatment. "At that time, enterprises were dominated by capital and had very low technology content. Technology, one of the three major drivers of the water market, has been dwarfed. In technology-based water companies, the weight of technology is in the water market. Is relatively small."

"With the adjustment of the industrial structure and the improvement of technical content, and the use of waste water as resources, the technical content of water companies is increasing." Fu Tao said that the future water industry will be a market that combines resource and harmlessness. . Harmlessness will further expand the market space. For example, in the fields of rural sewage treatment, the market will expand. However, in the field of expansion, enterprises also need deep plowing and meticulous work centered on resource utilization. "After five years, the water market may be centered on resource utilization."

Fu Tao said that the development trend of harmlessness and resource utilization has also spawned the game of capital and technology in the environmental protection market. In the next five years, the weight of technology in the environmental protection industry will gradually exceed the weight of capital. "The reason is that with the increasing requirements and deepening of services, when the pursuit of fine details begins, the technology-led component will gradually increase. And the water industry, which is part of the environmental protection industry, will also make great progress."

Enterprises still need to cultivate the core

The business model has always been driven by industrial exploration, and the original driving force of the water industry is far from being fully utilized.

In the past year or two, macro policies for energy conservation and environmental protection have been introduced intensively. In this regard, Fu Tao analyzed: "The policy benefits are basically released, and the key is that the environmental protection industry must do what it takes. That is, actions speak louder than words, and it is better to do.

With the development of the water industry in the direction of technology specialization, service integration, and asset scale, the general direction of water industry enterprises is to deepen and expand. From a deep perspective, there are several directions. For example, the service standards of water companies will become higher and higher, and improvements are needed in terms of cost reduction, energy saving and consumption reduction, and standardization, informatization, low risk, and high security of sewage treatment plants. . Broadening includes value-added services for enterprises, co-processing of water, gas and solids, integration of environment and agriculture, organic recycling of sludge, and integration of environment and energy.

He believes that business model innovation has always been driven by industry exploration. The original power of the water industry is far from being fully utilized. The current development momentum of the water industry is strong enough, capital talents have basically gathered, and the industry leader has emerged. "If an industrial policy benefits all enterprises in the industry, it may be an industrial disaster." Fu Tao pointed out that in fact, after the general direction of the industry is clear, outstanding enterprises should expand their space in responsibility and innovation to achieve development.

"The water industry also urgently needs to establish business ethics and business ethics in this industry." He also said that from the perspective of endogenous cultivation of water companies, companies should focus on the promotion of brand, corporate culture, management, informationization, and technology.