Recently, we investigated Huaxing Chemical and exchanged views with the head of the company's securities department on issues such as the current business situation and future development plans. The company's old factory area is located in Wujiang Town, Hexian County, close to Bawang Temple, a tourist attraction in Anhui Province. It has had a certain impact on the surrounding residents and the tourist environment. According to the municipal government's development plan, the company's old factory area was relocated. In June 2009, the company signed a relocation agreement with the Hexian County Government and agreed to relocate to Hexian Fine Chemical Park. According to the relocation agreement, the company received compensation for 1,500 acres of land in Hexian County, of which 1,000 acres are located in the fine chemical park. After the relocation of the old factory area is completed, another 500 acres of land in the old factory area will be converted into commercial land, and the company can carry out commercial development according to the actual situation. According to our research, the relocation did not affect the company's ongoing production and operation. The company adopted a gradual relocation method. Currently, the old factory area is still in production. Production capacity and facilities in the old factory area will only be relocated to the new factory area after the corresponding construction of the new factory area is completed. According to the current schedule, it is expected that the overall relocation of the company will be basically completed in August next year. We believe that the company's old factory area has limited space to expand. After the relocation, the land that the company can use has increased greatly, and upstream and downstream supporting construction is possible, which is beneficial to the company's long-term development. We expect the company's earnings per share from 2010 to 2012 to be 0.28 yuan, 0.44 yuan, and 0.52 yuan, respectively. The PE corresponding to the closing price on April 26, 2010 is 40 times, 26 times, and 22 times, respectively. Currently, the company's valuation is at a reasonable level, and we have given a “neutral” investment rating.