On October 23, 2009, Changchun Yidong, which was suspended for one month, announced its private placement plan. The company intends to issue no more than 90 million shares at a price of 9.78 yuan per share, acquiring 95.35% of Jilin Dahua Machinery Company, all operating assets and liabilities of Jilin Automobile Brake Factory, and 85% of Shandong Pengxiang Automobile Company.

At present, Changchun Yidong mainly engages in the manufacture and sales of automobile clutch. The products are mainly for automobiles and low-speed vehicles (agricultural vehicles), of which heavy vehicle clutches account for nearly half of the company's total sales revenue. The relative singleness of products and supporting objects leads to a large decline in the business performance of the enterprise, and the company is in a situation of loss.

In order to reverse the current passive situation and change the declining trend of the company, this private placement is brewing. If implemented smoothly, the company's main business will expand from automobile clutch to automobile tooth ring (including tooth ring assembly), automobile braking system products and modified vehicles, chassis, axles and other fields.

According to the relevant public information, the overall profitability of the assets purchased by the private placement is still strong. If the private placement is implemented smoothly, the business performance of the enterprise will be greatly improved. Simulation calculations show that the profit in 2009 can not only turn losses into profits, but even reach the level of hundreds of millions of dollars. Of course, considering that the actual implementation of private placement still needs to be approved by the relevant departments, the most optimistic estimate is that the performance in 2009 can only be shown for two months, and the change in the overall appearance of the company can only be fully reflected in 2010.

In view of the fact that the business scope and profit situation of the enterprise will change greatly after the implementation of this private placement, it is simulated and estimated that EPS can reach the level of 0.5 yuan, so Changchun Yidong is given the investment rating of "increasing its holdings", with a target price of 15 yuan, corresponding to about 30 times of PE.