# Shanxi LuAn Environmental Energy Development (601699.SHG)

Canonical: https://gigainvestors.com/s/601699.SHG

Analysis as of: 2026-10-16T07:36:48.839Z. Financial observations: FY2003–FY2025.

Listing currency: CNY. Reporting currency: CNY.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: CNY 14.87 per share; close as of 2026-10-15.

Estimated value: low CNY 20.49 per share, central CNY 22.75 per share, high CNY 25.75 per share. Buy at or below the central value CNY 22.75 per share. Valuation as of 2026-10-16T07:36:48.839Z; scenarios are not confidence intervals.

Expected annual return: 15.4% at the stated quote. About 15.4% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; CN 10-year bond 1.7% + 4 points).

## Checklist

### understandable: fail

- 4 revenue declines in the last 10 years (informational)

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 4

- Years with a net loss: 0

- Operating margin variation: 0.60×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.08×

- FY2017: 0.14×

- FY2018: 0.10×

- FY2019: 0.11×

- FY2020: 0.11×

- FY2021: 0.24×

- FY2022: 0.38×

- FY2023: 0.27×

- FY2024: 0.12×

- FY2025: 0.05×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- Recent gross margin fell 5.0pp below the typical margin (limit 4pp)

- ROIC, median of available years: 8.5%

- ROIC, second-lowest year: 3.1%

- Typical minus recent gross margin: 5.0 pp

- Typical gross margin (annual median): 38.0%

- Recent gross margin (lower of latest and 3-year median): 33.0%

- Years with nonpositive capital: 0

- Capital spending / revenue: 4.5%

- ROIC including acquisitions, ten-year median: 12.3%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 3.0%

- FY2017: 8.6%

- FY2018: 6.7%

- FY2019: 8.7%

- FY2020: 6.6%

- FY2021: 20.7%

- FY2022: 68.0%

- FY2023: 74.0%

- FY2024: 8.4%

- FY2025: 3.1%

### economics: pass

- Owner earnings / net income, 5-yr: 0.92×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: CNY 30B

- Net income, five-year total: CNY 32B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: -1.3 pp

- Working capital / revenue, change between three-year averages: -10.6 pp

- Working capital / revenue, final three-year average: -23.1%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.05×

- FY2022: 1.18×

- FY2023: 1.33×

- FY2024: -3.29×

- FY2025: 3.19×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 6.7% vs 8.4%

- Per-share earnings: 0.22 to 0.82 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 0.4%

- Ordinary dilution, 5-year annual growth: -1.2%

- Market cap gain: CNY 4.3B

- Cumulative retained earnings: CNY 21B

- Diluted shares, 10-year annual growth: 0.4%

- Diluted shares, 5-year annual growth: -1.2%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 17.8%

- Per-share value change: CNY 0.60

- Per-share value, starting three-year median: CNY 0.22

- Per-share value, ending three-year median: CNY 0.82

- Buyback history: 0 years

- Debt-funded buybacks: No

- Acquisition spending: CNY 17B

- Cumulative net income, 10 years: CNY 43B

- ROIC, first three-year median: 6.7%

- ROIC, last three-year median: 8.4%

Chart: Earnings per share; fiscal year observations.

- FY2016: CNY 0.22

- FY2017: CNY 0.92

- FY2018: CNY 0.78

- FY2019: CNY 0.78

- FY2020: CNY 0.61

- FY2021: CNY 2.26

- FY2022: CNY 4.74

- FY2023: CNY 2.65

- FY2024: CNY 0.82

- FY2025: CNY 0.37

### accounting: pass

- Sloan accruals: -4.9%

- Receivables to sales index (DSRI): 0.31×

- Restructuring years, last five: 0

- Earnings backed by cash: Yes

- Operating cash / earnings: 4.48×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.02×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -0.5%

- FY2017: 0.6%

- FY2018: -10.7%

- FY2019: -2.8%

- FY2020: -0.4%

- FY2021: -1.4%

- FY2022: -20.7%

- FY2023: -1.1%

- FY2024: -3.1%

- FY2025: -4.9%

## Holders

## Price story

Down 42% since Feb 2024 · sales -22.4%

Story as of 2026-10-16T10:00:08.113Z; price observation 2026-10-15.

Price needs cash profits to shrink 6% a year for ten years

### Sales · FY2024–2025

sales -22.4%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: CNY 14B 

- FY2017: CNY 24B 

- FY2018: CNY 27B 

- FY2019: CNY 27B 

- FY2020: CNY 26B 

- FY2021: CNY 45B 

- FY2022: CNY 54B 

- FY2023: CNY 43B 

- FY2024: CNY 36B 

- FY2025: CNY 28B 

### Gross margin · FY2025

gross margin 33%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: 35.2% 

- FY2017: 40.3% 

- FY2018: 38.0% 

- FY2019: 38.0% 

- FY2020: 33.3% 

- FY2021: 48.1% 

- FY2022: 55.5% 

- FY2023: 47.2% 

- FY2024: 36.3% 

- FY2025: 33.0% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in thermal coal; annual sales are CNY 27.8 billion.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2025: revenue 27820028155.61; grossProfit 9177583081.77; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 601699.SHG: Shanxi Lu'an Environmental Energy Development Co., Ltd. engages in the production and sales of coal and coke products in China. The company focuses on raw coal mining, coal washing and beneficiation, and coal and coke smelting. It also develops and utilizes clean coal technology; develops coalbed methane; and manufactures coal liver stone brick. The company owns production mines in Wangzhuang Coal Mine, Zhangcun Coal Mine, Changcun Coal Mine, and Wuyang Coal Mine. It also engages in gas and mineral exploration; geological drilling; accommodation, catering, conference, and travel services; sales and leasing of machinery and equipment; and road transportation of cargo. The company was founded in 2001 and is based in Changzhi, China. Shanxi Lu'an Environmental Energy Development Co., Ltd. operates as a subsidiary of Shanxi Lu'an Mining Industry Group Company Limited.

### Why customers stay

Margins ranged from 33% to 47.2% during 2023–25; it earns 8.5% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2023: grossProfit / revenue = 47.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2024: grossProfit / revenue = 36.3%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2025: grossProfit / revenue = 33%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); 10-year return on capital observations [[2016,0.029529083766634188],[2017,0.08622957433010997],[2018,0.0673200643582257],[2019,0.0868063884373547],[2020,0.06609539236935122],[2021,0.206798039704731],[2022,0.679961045736637],[2023,0.7402931294948943],[2024,0.0835308550281119],[2025,0.030760161097058005]]; median 0.08488021467911094. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2016: growth capex 0; upkeep 869162330.04; owner earnings 1188579076.96. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2017: growth capex 0; upkeep 438145315.85; owner earnings 3709323684.15. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2018: growth capex 0; upkeep 1213576907.14; owner earnings 3408224092.8599997. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2019: growth capex 0; upkeep 1460271511.97; owner earnings 2844900488.0299997. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2020: growth capex 0; upkeep 1159188528.82; owner earnings 2818030471.1800003. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2021: growth capex 0; upkeep 2151077660.97; owner earnings 7059276015.81. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2022: growth capex 0; upkeep 750719604.45; owner earnings 16663504492.506. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2023: growth capex 0; upkeep 678382333.96; owner earnings 10547168441.32. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); FY2025: growth capex 0; upkeep 202024360.82; owner earnings 3557477936.5439997. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); Dividend observations: [[2016,810717621],[2017,1023076661],[2018,1465417595],[2019,801697665],[2020,714946798],[2021,580333378],[2022,2013218390],[2023,8568570636.99],[2024,4758109000],[2025,1238383010.56]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 63.3% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 601699.SHG SharesStats.PercentInsiders = 63.349999999999994 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits shrink 6% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:48.839Z); Ten-year compound average after fade. Initial solved rate -0.0973704590595495. Price 14.87; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share -0.31300474457533295 → FY2025 1.180344644028688. Closing-price date 2026-10-15.

## Monthly share-price history (CNY per share)

- 2016-10: CNY 8.69 per share

- 2016-11: CNY 9.35 per share

- 2016-12: CNY 8.05 per share

- 2017-01: CNY 9.42 per share

- 2017-02: CNY 9.10 per share

- 2017-03: CNY 8.87 per share

- 2017-04: CNY 7.94 per share

- 2017-05: CNY 7.04 per share

- 2017-06: CNY 7.82 per share

- 2017-07: CNY 9.69 per share

- 2017-08: CNY 11.31 per share

- 2017-09: CNY 10.25 per share

- 2017-10: CNY 9.34 per share

- 2017-11: CNY 10.50 per share

- 2017-12: CNY 11.38 per share

- 2018-01: CNY 12.87 per share

- 2018-02: CNY 12.48 per share

- 2018-03: CNY 10.62 per share

- 2018-04: CNY 10.26 per share

- 2018-05: CNY 9.39 per share

- 2018-06: CNY 9.26 per share

- 2018-07: CNY 8.81 per share

- 2018-08: CNY 7.99 per share

- 2018-09: CNY 8.04 per share

- 2018-10: CNY 8.25 per share

- 2018-11: CNY 7.42 per share

- 2018-12: CNY 6.66 per share

- 2019-01: CNY 6.93 per share

- 2019-02: CNY 8.17 per share

- 2019-03: CNY 7.83 per share

- 2019-04: CNY 8.25 per share

- 2019-05: CNY 7.71 per share

- 2019-06: CNY 7.94 per share

- 2019-07: CNY 8.24 per share

- 2019-08: CNY 7.41 per share

- 2019-09: CNY 7.24 per share

- 2019-10: CNY 7.01 per share

- 2019-11: CNY 6.92 per share

- 2019-12: CNY 7.26 per share

- 2020-01: CNY 6.70 per share

- 2020-02: CNY 6.06 per share

- 2020-03: CNY 5.83 per share

- 2020-04: CNY 5.68 per share

- 2020-05: CNY 5.55 per share

- 2020-06: CNY 5.57 per share

- 2020-07: CNY 6.37 per share

- 2020-08: CNY 6.30 per share

- 2020-09: CNY 6.10 per share

- 2020-10: CNY 5.88 per share

- 2020-11: CNY 6.57 per share

- 2020-12: CNY 6.50 per share

- 2021-01: CNY 5.46 per share

- 2021-02: CNY 5.73 per share

- 2021-03: CNY 6.13 per share

- 2021-04: CNY 8.95 per share

- 2021-05: CNY 10.38 per share

- 2021-06: CNY 11.81 per share

- 2021-07: CNY 12.50 per share

- 2021-08: CNY 15.90 per share

- 2021-09: CNY 15.01 per share

- 2021-10: CNY 12.94 per share

- 2021-11: CNY 10.80 per share

- 2021-12: CNY 11.31 per share

- 2022-01: CNY 12.09 per share

- 2022-02: CNY 13.92 per share

- 2022-03: CNY 16.60 per share

- 2022-04: CNY 15.49 per share

- 2022-05: CNY 15.93 per share

- 2022-06: CNY 14.62 per share

- 2022-07: CNY 13.77 per share

- 2022-08: CNY 15.87 per share

- 2022-09: CNY 16.88 per share

- 2022-10: CNY 16.79 per share

- 2022-11: CNY 19.07 per share

- 2022-12: CNY 16.85 per share

- 2023-01: CNY 19.80 per share

- 2023-02: CNY 22.30 per share

- 2023-03: CNY 21.94 per share

- 2023-04: CNY 20.15 per share

- 2023-05: CNY 18.70 per share

- 2023-06: CNY 16.32 per share

- 2023-07: CNY 16.34 per share

- 2023-08: CNY 16.28 per share

- 2023-09: CNY 18.99 per share

- 2023-10: CNY 19.00 per share

- 2023-11: CNY 21.87 per share

- 2023-12: CNY 21.91 per share

- 2024-01: CNY 23.70 per share

- 2024-02: CNY 25.84 per share

- 2024-03: CNY 20.69 per share

- 2024-04: CNY 21.14 per share

- 2024-05: CNY 22.68 per share

- 2024-06: CNY 18.13 per share

- 2024-07: CNY 15.55 per share

- 2024-08: CNY 14.30 per share

- 2024-09: CNY 17.65 per share

- 2024-10: CNY 14.60 per share

- 2024-11: CNY 14.64 per share

- 2024-12: CNY 14.36 per share

- 2025-01: CNY 12.58 per share

- 2025-02: CNY 12.05 per share

- 2025-03: CNY 12.03 per share

- 2025-04: CNY 10.92 per share

- 2025-05: CNY 10.74 per share

- 2025-06: CNY 10.55 per share

- 2025-07: CNY 13.72 per share

- 2025-08: CNY 12.97 per share

- 2025-09: CNY 14.24 per share

- 2025-10: CNY 14.80 per share

- 2025-11: CNY 13.04 per share

- 2025-12: CNY 11.80 per share

- 2026-01: CNY 13.63 per share

- 2026-02: CNY 14.89 per share

- 2026-03: CNY 13.55 per share

- 2026-04: CNY 16.16 per share

- 2026-05: CNY 16.00 per share

- 2026-06: CNY 14.28 per share

- 2026-07: CNY 15.10 per share

- 2026-08: CNY 17.95 per share

- 2026-09: CNY 15.09 per share

- 2026-10: CNY 15.59 per share

## Annual estimated value (CNY per share)

- FY2018: low CNY 13.54 per share, central CNY 14.67 per share, high CNY 16.16 per share

- FY2019: low CNY 14.94 per share, central CNY 16.34 per share, high CNY 18.21 per share

- FY2020: low CNY 14.60 per share, central CNY 15.93 per share, high CNY 17.69 per share

- FY2021: low CNY 30.54 per share, central CNY 39.92 per share, high CNY 45.91 per share

- FY2022: low CNY 35.38 per share, central CNY 38.88 per share, high CNY 43.53 per share

- FY2023: low CNY 33.23 per share, central CNY 36.62 per share, high CNY 41.12 per share

- FY2024: low CNY 24.40 per share, central CNY 27.22 per share, high CNY 30.97 per share

- FY2025: low CNY 21.52 per share, central CNY 23.68 per share, high CNY 26.57 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:42:26.034Z where newer inputs omit a numeric field or fiscal period.

## Sources

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.

## Reported holder observations