Revenue and net profit increased rapidly. In 2010, the company achieved operating income of 490 million yuan, an increase of 29% over the previous year; net profit of 120 million yuan, an increase of 48% over the previous year. Based on the total share capital of 147 million yuan after issuance, earnings per share were 0.81 yuan. The company's total profit was about 10 million yuan higher than operating profit. We judge that the company had non-operating income of more than 9.5 million yuan in the second half of the year. The company's actual income tax rate was also less than in 2009, making the net profit margin grow much faster than the operating income. The industry is growing rapidly, and the company is positioned in the high-end market. The company with a high gross margin is an electronic security product supplier that drives business development through technology research and development. The main products include video surveillance systems (cameras, DVRs, and video management software), optical transceivers, and access control systems. In the next three to four years, the global security industry will grow by 13-14% every year, and China's security industry will grow by more than 20%, and the company will benefit from the industry's high growth. The company's core management team all have more than ten years of management and technical experience in the security industry, and a R&D team of more than 200 people. Positioned in the high-end market, it has achieved a gross profit margin of ten percentage points higher than the industry level. The company has a global vision, and 20% of its revenue comes from overseas markets. The production capacity expansion plan will break the growth bottleneck. The company's current annual production capacity is 120,000 units (sets). The equipment is in line with operation in the first half of 2010, and the output exceeds 74,000 units (sets). The fund-raising project will increase production capacity by about 355,000 units (sets) a year, and the production capacity will increase by 186%. The company's growth bottleneck will be broken, and operating income will increase by more than 50% this year and next two years. The current valuation is quite reasonable. To give an increase in holdings rating, we gave the company a price-earnings ratio of 40 times its earnings per share in 2011, corresponding to the target price of 52.34 yuan, and an increase in holdings rating.