From January to September 2009, the company achieved operating income of 105 million yuan, a year-on-year decrease of 2.30%, and net profit attributable to the parent company of 21.58 million yuan, an increase of 47.10% over the previous year, and diluted earnings per share of 0.21 yuan; driven by the recovery in the bus market, the company's operating income in July-September increased 55.67% year on year. The company is a small to medium private enterprise. It mainly produces electric eddy-current retarders for auxiliary braking. The vast majority of them are used for large and medium buses, and a small portion is used for cargo trucks. In January-June, sales of large and medium vehicles and chassis decreased by 30.74% and 15.99% year on year. The decline in sales volume for large and medium customers improved in the third quarter. From January to September, passenger and chassis sales fell 7.98% year on year, and medium passenger and chassis increased 2.62% year on year. Bus sales in July-September also showed a month-on-month upward trend. Among them, the sales volume of passenger cars and chassis in September increased by 40.06% and 16.04% month-on-month, up 29.94 and 5.35 percentage points from August. Benefiting from the recovery of buses, the company achieved operating income of 52.44 million yuan in July-September, an increase of 55.67% over the previous year, net profit attributable to the parent company of 13.69 million yuan, an increase of 205.20% over the previous year, and diluted earnings per share of 0.13 yuan. It is expected that the large and medium customer markets will pick up further in the fourth quarter, and the company's performance will continue to improve. The price of raw materials is low, and the company's consolidated gross margin in the third quarter rose 7 percentage points year on year. The company's comprehensive gross profit margin for the third quarter was 42.10%, an increase of 6.5 percentage points over the previous year, a record high. The LME March copper price fell from an average of 8,000 US dollars/ton in 2008 to an average of 6,000 US dollars/ton now. Affected by low copper prices, the reduction in the average procurement cost of enamelled copper wire, the main material of the company's products, increased the company's overall gross profit margin. We believe that copper prices will rise in the fourth quarter, that the company's gross margin will decline to a certain extent, and it is estimated that the gross margin for the whole year will be around 38%. Cargo trucks may become a new profit growth point for the company. The company mainly produces three types of retarders: B type, R type and M type. Among them, the B and R models are mainly used for large and medium-sized buses, while the M type is used for heavy cargo trucks. Currently, there is very little sales volume in the truck retarder market, yet the truck market space is several times larger than the bus market, and the potential is huge. In 2008, sales of heavy trucks and semi-trailer tractors reached 300,000 units, far higher than sales of large and medium-sized buses of 80,000 units. The company raised capital in 2008 to expand production and construction of M-type retarders to support heavy trucks, which have now been basically completed. It is expected that after delivery, the company will form a production scale of 25,000 sets of M-type retarders. Raise the company's rating to “increase in holdings.” Considering the rapid recovery of the bus industry and the huge potential of the heavy truck market, we raised the company's rating to “increase in holdings.” It is estimated that the company's EPS in 2009 and 2010 will be 0.37 yuan and 0.42 yuan respectively. Using the closing price of 10.19 yuan on October 20, the dynamic PE is calculated 28 times and 24 times, respectively.