The investment logic is to look at the future development of Fangzheng Technology from a group perspective, and the PCB business will be mainly supported: “IT consulting” and PCB manufacturing have become important directions for the future development of Fangzheng Group; while the PC manufacturing business divestment (6 billion output value) prompted Fangzheng Group to accelerate PCB business development (1.5 billion output value last year), thereby closing the revenue gap caused by the divestment of the PC business; within the next three years, Fangzheng Technology's PCB business will continue to lead the country in terms of technology, and become the main player in achieving the Group's PCB strategy: 1. High starting point, Fangzheng Technology's PCB business has maintained a leading trend in technology in the country and is beginning to enter the international market Competitiveness; 2. High-end HDI boards and high-frequency backboards will be the biggest beneficiaries of the boom in smart terminals, and the output value of this product is ten times greater than that of packaged substrates; 3. Fangzheng Technology has achieved a technological breakthrough in high-end HDI boards, and the customer resources of Zhuhai Yueya will help it achieve a breakthrough in the high-end market. 2011 will be the starting point for the inflection point of Fangzheng Technology's business: 1. The yearly divestment of the PC business will reduce the amount of losses borne by listed companies and increase the performance growth rate; 2. The company has invested 1,636 billion yuan to expand the PCB business, which will bring about an output value of nearly 1.7 billion yuan (in 2010, its PCB business output value was only 1,533 billion yuan), and has entered production in 2011, thus ensuring a compound increase of more than 30% in the company's PCB business revenue over the next three years; 3. The new production capacity is concentrated on high-margin products such as high-end HDI boards and high-frequency backboards, plus superior quality in Zhuhai customer base, thereby increasing the company's gross profit margin. Investment recommendations and valuation have a compound growth rate of 30% in net profit for three years and EPS of 0.161 yuan in 2012: The company is expected to achieve net profit of 230.70, 352.76 and 540.17 million yuan in 2011-2013, a year-on-year increase of -4.22%, 52.91%, and 53.13%. Based on the latest share capital, the EPS is 0.105, 0.161, and 0.246 yuan. Using the business spin-off valuation method, the target price is 3.94 yuan, giving a “buy” rating: the PCB business is expected to contribute 0.093 yuan, 0.150 yuan, and 0.234 yuan in EPS in 2011-13. Referring to the valuation level of listed domestic PCB companies, the target price of 3.74 yuan is given; the PC business is expected to contribute 0.012 yuan, 0.11 yuan, and 0.012 yuan in EPS in 2011-13, referring to the valuation level of Lenovo Group (00992.HK), giving Fangzheng Technology's PC business a target price of 0.2 yuan, corresponding to a market profit ratio of 16.6 yuan in 2012 。 Risk Management Group shifts the focus of PCB operations to the risk of Zhuhai, Vietnam, and Asia, and the risk of declining gross margin.