The reduction in RFID prices has driven the explosion of overseas demand. In the past three years, the price of ultra-high frequency RFID in supermarkets has been reduced from 2 yuan to 0.7 yuan. The price drop has led to the continuous expansion of RFID applications. The spread of RFID abroad, Walmart, Macy's, etc. have all begun to make extensive use of RFID, and the international market has entered a period of rapid growth. The domestic factors limiting the development of RFID are being overcome. The biggest difficulty in domestic application is that there are no relevant national standards for RFID applications, and there are no large-scale successful cases; we believe that RFID industry standards will be set from the bottom up, that is, leading enterprises set standards and make benchmark cases, and then the entire industry will adopt them. As CIMC promotes RFID management of containers and Alibaba applies RFID to logistics management, the formation of industry standards and standards will accelerate. China's RFID logistics application is expected to repeat the path abroad, and the industry will enter a period of acceleration. Leading enterprises in the Internet of Things, with a comprehensive layout, entered a harvest period starting in 2010. The company's comprehensive layout in the non-railway market in 2012 had already far surpassed the railway market. In 2013, through the external acquisition of Haiheng Intelligence, the RFID library business became the largest source of revenue. Container logistics management, retail RFID tags, and digital grain banks began to be harvested after maturing, and the company will enter a period of accelerated growth. A series of acquisitions and cooperation projects indicate that the company has moved from selling products to solutions and post-operation fields, which will open up more market space and improve performance stability, and become a leader in the domestic logistics RFID field. Profit forecast and valuation We expect the company's 13-15 EPS to be 0.27, 0.41 and 0.51 yuan, respectively, and YOY at 61.55%, 52.16%, and 25.29%. Considering the company's leading position in the RFID field, the company was given a “buy” rating. The reasonable value for the next 6 months is 12 yuan, corresponding to 30X14PE. If Henan Thinking Automation, which holds 20% of the company's shares, goes public in the future, it is expected to generate higher investment returns and increase the margin of safety. Risk warning: The risk of falling railway investment, and the progress of non-railway business falls short of expectations