Conclusions and suggestions: The company is one of the major domestic alkali producers. Due to the impact of the new real estate policy, the downstream glass industry's production growth rate has slowed, so demand for soda ash has decreased; however, the growth rate of new production capacity for soda ash has been too rapid in recent years, leading to an imbalance between supply and demand in the market, and it is not expected that there will be a significant improvement in the second half of the year. We expect the company's 2010 and 2011 EPS to be 64.4 times and 29.8 times the dynamic PE, respectively, giving neutral investment recommendations. The company achieved operating income of 1,626 billion yuan in the first half of 2010, an increase of 9.45% over the previous year; realized net profit attributable to the parent company of 28.83 million yuan, compared with a loss of 1.75 million yuan in the same period last year; earnings per share were 0.062 yuan. Among them, net profit of 5.49 million yuan was achieved in the second quarter, down 76% from the previous quarter, which was slightly lower than expected. The company's gross margin for the first half of the year increased to 19.36% from 13.09% in the same period last year. In the first half of the year, the company's Shell coal gasification production system achieved long-term full load operation, increasing production and sales and driving profit growth. Among them, the parent company produced 204,000 tons of synthetic ammonia, an increase of 15% over the previous year; it produced 539,000 tons of soda ash, an increase of 21.6% over the previous year. 561,000 tons of ammonium chloride were produced, an increase of 22.3% over the previous year. Recently, the company plans to complete the acquisition of 49% of the shares of Hubei Yihua Group and 55% of Chongqing Yihua Group's shares for 157 million yuan and 352 million yuan respectively. After the acquisition was completed, the company's shareholding in Chongqing Yihua increased from 22.95% to 100%, and the company's total interest in soda ash production capacity increased from 1.18 million tons to 1.8 million tons. In particular, Chongqing Yihua acquired 99.9868% of Chongqing Sote Salt Chemical Co., Ltd. in early June, completing the expansion of the upstream industrial chain, which will further reduce product costs. In the second half of the year, the company expects the headquarters and Sun Company's Chongqing Yihua plant to maintain full production capacity, with annual soda ash production reaching 1.8 million tons, a slight increase of 2% over the previous year. From January to June 2010, China's cumulative production of soda ash reached 10.72 million tons, and the market supply was sufficient; due to economic recovery, soda ash prices rose rapidly in the first quarter, but due to the subsequent introduction of China's new real estate policy, the downstream glass industry's output growth rate slowed, so demand for soda ash declined, and prices began to fall in April. Currently, the factory price of the company's light alkali is around 1,200-1,300 yuan/ton. The soda ash industry is still plagued by an imbalance between supply and demand in the second half of the year. Prices may maintain a consolidated trend, and the soda ash business maintains a basic balance of profit and loss, but upstream coal costs may fall in 2011, and gross margin will increase, thereby increasing profits. There were many disasters in various parts of the country in the first half of this year, which had a certain impact on the demand for nitrogen fertilizer, making it difficult for prices to improve significantly. The sales price of the company's main product, ammonium chloride, fell back to 500 yuan/ton, a year-on-year decline of about 10%. However, the disastrous weather also caused agricultural product prices to rise. In addition, in order to stabilize grain production throughout the year, encourage post-disaster replanting, and increase subsidies for growing food in some regions, we believe it will have a driving effect on the demand for chemical fertilizer in the second half of the year, and most domestic ammonium chloride is used for compound fertilizer production. We expect that the ammonium chloride market may show signs of recovery, leading to an increase in the company's profits. We expect the company to achieve net profit of 47.01 million yuan and 102 million yuan in 2010 and 2011, an increase of 1004% and 116.7% over the previous year; EPS of 0.101 and 0.219 yuan, respectively; and dynamic PE of 64.4 times and 29.8 times, giving neutral investment advice.