Incident: On July 4, 2014, Mindong Electric Power announced that the company recently received approval from the Price Control Bureau of Ningde City, Fujian Province to re-approve the company's feed-in tariff for the Mindong Hydropower Station and the Huanglanxi Cascade Hydropower Station. Among them, the electricity price for the Mindong Hydropower Station was raised from 0.3 yuan (tax included) to 0.32 yuan (tax included), and the electricity price for the Huanglanxi Cascade Hydropower Station was raised from 0.35 yuan (tax included) to 0.37 yuan (tax included). The new feed-in tariff began to be implemented on June 16, 2014. Comment: Water and electricity costs are stable, and price increases are converted into profits. The operating costs of the hydropower industry are relatively fixed. This is mainly determined by the characteristics of the industry, and there will be no drastic changes with changes in operating income. While the total installed capacity remains unchanged, fluctuations in the company's hydropower sector performance are mainly affected by two factors: water intake and feed-in electricity prices. The current electricity price adjustment involves two subordinate hydropower plants, including: the East Fujian Hydropower Station has an annual design capacity of 89 million kilowatts, and the Huanglanxi Cascade Hydropower Station has an annual design capacity of 126 million kilowatts. Based on the annual design amount of electricity, assuming no change in precipitation, this electricity price adjustment will cause the company's annual revenue to increase by about 4 million yuan (tax included). The diversification strategy progressed and expanded into the field of new materials. Since 2012, the company has entered the mining industry, but due to the slow recovery of the global economy and China's economic transformation, global mineral prices have continued to fall. In particular, the molybdenum ore market continues to be sluggish. Fuan Xindi Molybdenum Co., Ltd., which holds 20% of the company's shares, and Ningde Huansan Mining Company both lost money in 2013. The company stated that it will continue to advance the overall development strategy of “electricity as the main focus, related diversification”, avoid profit fluctuations in a single main business, and develop from a single power development and production to diversified direction such as real estate, mining, trade, and finance. The establishment of the Innovation Research Institute by the Company and Tsinghua University Bauhinia Holdings in June 2014 was a key step in the company's transformation into the field of new materials. Profit forecast and rating: Due to higher electricity prices, we raised the company's 14-16 net profit forecast by 0.32%, 0.34%, and 0.37%. However, due to the small absolute amount of increase in net profit, the company maintained its 14-16 EPS forecast of 0.22 yuan, 0.24 yuan, and 0.26 yuan, and continued to give it an “increase in wealth” rating. Risk factors: Precipitation dropped sharply, hydroelectric power generation declined; real estate sales fell short of expectations; global economic decline, and metal prices fell.