Citi published a report reaffirming its investment rating for the “purchase” of Pearl River Steel Pipe, giving it a target price of 4.18 yuan. Based on an average return on equity of about 17% from 2011 to 2013, it is estimated that its capital cost is 12.5%, which is also equivalent to a forecast market ratio of 1.5 times. According to Citi, Pearl River Steel Pipe ordered 133,000 tons of new steel pipes in the fourth quarter of last year, bringing on-hand orders for the full year of last year to 608,000 tons (compared to 475,000 tons in the first three quarters of 2010), indicating that new orders in the fourth quarter of last year reached 133,000 tons, an increase of 45% from quarter to quarter, with strong order performance. According to Citi, Pearl River Steel Pipe holds orders for 608,000 tons of steel pipes and has already reached last year's sales performance. It also indicates that the stock's current price is 7.4 times the predicted price-earnings ratio in 2011, which is a 54% discount compared to Peer Victory Pipeline (01080-HK), indicating that it has several catalysts, including deep water pipeline projects that can be invested in CNOOC (00883-HK), and new infrastructure projects. Pearl River Steel Pipe closed at HK$3.77 for the whole day.