I. Incident Overview From January 1, 2012 to September 30, 2012, the net profit attributable to shareholders of listed companies is expected to make a profit of 10 million yuan - 11 million yuan, an increase of 6213%-6844% over the same period last year. 2. Analyze and judge the transformation of the company into the mining industry (trade). The performance has further clearly entered an upward channel. In order to improve the company's business conditions, the company signed an underwriting contract for 5 consecutive years with “Hong Kong Guangxin China-Africa Resources Investment Co., Ltd.”, in which the majority shareholders participate, for 5 consecutive years, at an annual contract price of 500,000 tons of titanium concentrate, at an underwriting price of 850 yuan/ton. In 2012, H1 successfully reversed losses by selling about 20,000 to 30,000 tons of titanium concentrate. The origin of the titanium concentrate underwritten by the company is Madagascar. According to statistics, it has imported a total of about 50,000 tons of titanium concentrate from Malaysia from January to August. Therefore, we judge that the company's titanium concentrate underwriting business is gradually entering a normal path, and the increase in Q3 net profit is still expected to come from titanium concentrate underwriting. It is expected that Q4 titanium concentrate sales will increase. The annual EPS is expected to be 0.18-0.51 yuan. According to the announcement, if the shipment volume does not reach the underwriting contract volume of 500,000 tons, the mine will pay compensation of 1 million yuan per 10,000 tons for each 10,000 tons, which will ensure the company's EPS of about 0.22 yuan. Based on statistics and climatic factors, we expect that Q4 package sales may increase significantly from month to month. We conservatively estimate that the freight volume in the second half of the year will be more than 100,000 tons, and the optimistic estimate is 30-400,000 tons. According to the interim report, the net profit of a ton of titanium ore is estimated to be about 320 yuan, while in 2012 EPS is conservatively estimated to reach 0.18 yuan (without compensation, the calculated compensation EPS reached 0.3 yuan), and the optimistic estimate is that EPS will reach about 0.51 yuan. In 2012, China's titanium concentrate imports are expected to be more than 3 million tons. Vietnam's export restrictions will free up about 500,000 tons of favorable space for the company's future titanium concentrate underwriting. According to statistics, a total of about 2.3 million tons of titanium concentrate were imported from January to August 2012. Annual imports are expected to exceed 3 million tons. Furthermore, Vietnam began restricting exports of titanium concentrate. From January to August 2012, China's average monthly import volume from Vietnam was about 113,000 tons. Assuming that the import volume falls to the average monthly value of 65,000 tons in 2011, it will free up about 500,000 tons of space every year. The company can make up for this gap. Furthermore, it is not ruled out that the company will use its scale advantage to replace the high-cost and small-scale mining enterprise market and gain a high market share in the titanium concentrate market, where the current market concentration is relatively low. The recent rise in titanium concentrate is also expected to have a favorable impact on the company's later results. A fixed increase of 50 million shares to the majority shareholders of 14.55 yuan indicates the possibility of further developing mineral chain deposits. At that time, the titanium and zirconium EPS alone is expected to reach 1.5 yuan, which far exceeds the capital required for the underwriting of titanium concentrate by more than 700 million yuan. Since the majority shareholders of the company participate in or control mining companies involving titanium, zirconium, tantalum, and niobium, we anticipate that the company may develop in these areas in the future. If the form of underwriting is still adopted, the titanium-zirconium ore business performance alone may reach an EPS of about 1.5 yuan at that time. 3. Profit forecast and investment proposal The underwriting contract for 500,000 tons of titanium concentrate is expected to form a bottom line of about 0.8 yuan for EPS with relatively safe performance in 2013. A fixed increase of 14.55 yuan/share to the majority shareholders is expected to support current stock prices and give a “highly recommended” rating. 4. Risk warning: 1. The contract was forced to be cancelled; 2. Weak downstream demand caused titanium prices to fall