The investment logic is backed by the intelligent equipment business to support the overall development of the company. The company's main customers are Bosch and United Electronics. Against the backdrop of high growth in new energy vehicle sales, Bosch continues to increase investment and expand electric vehicle motor production capacity. At the same time, in July of this year, United Electronics launched the second phase of construction of the Taicang plant. The cumulative equipment investment is expected to exceed 1.4 billion yuan, which is expected to drive the company's business growth. The average delivery cycle of intelligent equipment is about one year, so the performance is highly predictable. New orders for the company's intelligent equipment and industrial robot systems business reached 533 million yuan in '21, an increase of 86% over the previous year; 22H1's intelligent equipment business signed 270 million new orders, an increase of 6% over the same period last year, which guarantees an increase in performance next year. We expect the revenue of the automation equipment business to be 5.2, 60, 70 million yuan in 2022 to 2024, respectively, an increase of 94%/16%/17% over the previous year. The traditional auto zero business has benefited from the upgrading of national six emission standards. According to China's policy, from July 1, 2023, all cars sold and registered must meet national 6b standards. OEMs need to use turbocharging and other methods to meet the national six emission standards, thereby increasing the demand for products such as high-pressure fuel dispensers. Compared to ordinary fuel dispensers, the price of high-pressure fuel dispensers is nearly double. CO2 thermal management products are spear, opening up space for the company's future development. The Kigali Amendment has officially entered into force in China, promoting changes in automotive air conditioning refrigerants. Currently, there are two main routes: R1234yf and CO2. Compared with R1234yf refrigerants, CO2 refrigerants have the advantages of safety+environmental+good cooling and low temperature heating effects. CO2 thermal management systems require higher pressure resistance, precision, and pipeline tightness of valves and compressors. At present, the company has achieved batch supply of pipelines, and has established extremely high barriers in terms of materials, structures, processes, software algorithms, patents, etc. At the same time, the product performance is better than that of foreign-funded enterprises. In addition, the company has been actively developing valve products. As a scarce target in the domestic CO2 thermal management circuit, the company is expected to fully benefit from the upgrading and iteration of thermal management system technology in the future. We expect the auto parts business revenue for 2022 to 2024 to be 3.3/66/ 740 million yuan, respectively, up 11%/101%/12% year over year. Investment proposal The company's intelligent equipment business will benefit from customer demand to expand production brought about by the high growth of the automotive electronics industry in the future. At the same time, as a scarce target for domestic CO2 thermal management circuits, the company's products have strong bargaining power. We expect the company's net profit to be 0.772/1.51/186 million yuan respectively in 22/23/24, up 45%/109%/24% year over year, with a target market value of 7.6 billion yuan and a target price of 28.50 yuan/share, giving it an “increase in holdings” rating. Risks suggest that competition in the industry is intensifying, downstream demand falls short of expectations, and the progress of technology upgrading in the industry falls short of expectations.