Fangzheng Technology's main business and equity structure Currently, Fangzheng Technology's main business is concentrated on PC (desktop and notebook) and PCB boards. In 2008, the PC business achieved revenue of 6.11 billion yuan, down 20.77% from 2007; the PCB board business achieved revenue of 1.05 billion yuan, an increase of 81.53% over 2007. Judging from Fangzheng Technology's main business, the PCB board will become the main business growth point for Fangzheng Technology (600601), and is expected to achieve sales revenue of 1.5 billion dollars in 2009 due to the expansion of its production capacity; Fangzheng Technology currently accounts for about 20% of overall PC sales, and compared to the situation where notebooks in the PC industry account for close to 50%, there is no obvious advantage in increasingly fierce competition. The shares of Fangzheng Technology (600601) are relatively scattered. Fangzheng Group directly and indirectly holds 11.38% of the shares, making it the largest shareholder and the actual controller of the company. The development of the PCB business has become a highlight. Fangzheng Technology (600601) has a relatively single main business after listing, focusing on PCs and related supporting services. It has found new profit growth points through the PCB board business in the past two years, and its PCB business currently ranks second among domestic PCB companies after ultrasonic electronics. At present, the manufacturing of its PCBs has been completed in Zhuhai, which mainly includes HDI boards, high-multilayer boards, and system backboards. HDI boards are mainly used in handheld devices such as high-end mobile phones. The production capacity in 2008 was 200,000 square meters. With the gradual commencement of production in its Zhuhai Industrial Park, it achieved a production capacity of 300,000 square meters in 2009 and 500,000 square meters in 2010. High-end multi-layer boards and system backboards are mainly used in communication equipment such as switches, base stations, and routers in the communication field. Currently, Fangzheng Technology is preparing a production base for multiple high-rise boards and system backboards in the Xiyong Microelectronics Industrial Park in Chongqing, Sichuan. It is expected to achieve mass production in October 2009 and achieve a balance of profit and loss in 2010. Since China is in the process of informatization and industrial integration, we believe that its PCB board business will be supported by market demand and become the main profit growth point for Fangzheng Technology (600601). PC business increases channel construction and market strength Fangzheng Technology (600601)'s PC business ranked second among domestic manufacturers, ranking fifth with a share of 7.5% in the overall domestic market in 2008, a marked decline compared to the market share of nearly 10% in 2006 and 2007. The main reason is that the main advantage of Fangzheng Technology (600601)'s PC business is commercial desktops. Currently, the notebook business is only close to 20% of sales revenue, and there is a big gap between the trend of domestic and foreign notebooks accounting for nearly 50%. Since the average unit price of notebooks and gross profit are much higher than that of desktops, Fangzheng PC's market share is declining, and there are no obvious signs of improvement in this trend. Although there is now a policy of going PCs to the countryside, the popularity of PCs in economically underdeveloped regions is limited by actual consumption capacity, and the large extension of sales channels has increased sales costs. Therefore, in the short term, the promotion of the other party's PC business is limited, while foreign manufacturers such as HP, Dell, and ASUS are shortlisted for PCs going to the countryside, and the possibility that domestic manufacturers will benefit from this policy has also reduced the possibility that domestic manufacturers will benefit from this policy. Possibility of asset injection Fangzheng Group, as the actual controller of Fangzheng Technology (600601), involves many industries and branches, and is complex. We think it is not ruled out that in the future, Fangzheng Group's assets will enter listed companies, but at present, this possibility is not very high. Market valuation. We predict that its earnings per share from 2009 to 2011 will be 0.08 yuan/share, 0.11 yuan/share, and 0.15 yuan/share, respectively. Based on the current closing price, its 2009 PE is 55 times. We believe that in 2009, Fangzheng Technology (600601) had no obvious chance of surpassing the market, but due to the characteristics of its low-priced stocks and technology stocks, we believe that the current price is basically reasonable, and in 2009 it will be basically in line with the general market trend, giving it a neutral rating.