The 12-year performance was in line with expectations. The company achieved revenue and net profit of 1.64 billion yuan and 99 million yuan in 2012, an increase of 15.8% and 6.1% over the previous year, and an EPS of 0.18 yuan. Net profit after deducting non-recurring profit and loss was 93 million yuan, up 14.6% year on year, corresponding to EPS of 0.17 yuan. At the same time, the company disclosed that it would transfer 5 shares for every 10 shares. Driven by multiple factors, it is expected that growth will return to high levels in '13. We believe that the company is expected to regain high growth in 13 years because: 1) the industry has bottomed out: as a domestic leader, the company has consciously lowered the gross profit margin of the industry in the past few years, industry concentration has increased, and industry gross margin will hit bottom; 2) the dual process route to reduce production costs: the company's “sterol route” has further matured and can be applied to major products such as prednisone and dexamethasone. The dual path switch will drastically reduce production costs. 3) Further breakthroughs in exports are expected: the recognition of the company's products in regulated markets in Europe and the US is gradually increasing, and with the withdrawal of international giants, the export growth rate is expected to increase further. The annual salary incentive system has been introduced, and the motivation of the management team has been further increased. The company introduced a management level incentive system, which was very strong: the average total profit for the previous three years was set as the assessment base (109 million yuan in '13). The “effective annual salary” of the management level includes: 1) if the total profit reaches the assessment base, no more than 0.4% of the profit base will be withdrawn as performance pay; 2) if the portion exceeding the profit base is exceeded, the management layer will extract 20% as a reward. We believe that this approach has a large incentive range, will significantly increase the motivation of the management team, and drive further growth in the company's performance. Valuation: The target price is 7.8 yuan, maintaining the “buy” rating. We expect the company to have a negative EPS of 0.27/0.34 yuan in 13/14 (no change), and the introduction of a 15-year EPS forecast of 0.44 yuan. According to the UBS VCAM model, the target price was 7.8 yuan (WACC was 9.6%), maintaining the “buy” rating.