Company background: Baling Technology focuses on providing heat exchange application solutions, and has the ability to independently develop, design and manufacture heat exchangers. The company's main products are aluminum radiators, copper radiators, and car heaters, of which radiators account for about 56% of the company's total revenue. Other products include intercoolers, exhaust gas recirculation coolers, and non-automotive heat exchange systems. Industry pattern: 1) Radiators are important components in automobile engine cooling systems, which are essential to automobile power and economic safety, and the company has a stable market space. 2) Heat exchange companies generally support automakers directly, and market competition mainly occurs between domestic manufacturers, but car heat exchanger suppliers are mainly joint ventures. 3) At present, there are more than 300 domestic manufacturers, including 6 large enterprises, and the market share of the top five producers is 53.4%. Company position: 1) The company is a leading enterprise in the heat exchange industry and can provide a full range of products for copper hard brazing, copper soft brazing, and aluminum hard brazing. 2) Actively participated in integrated solutions and established stable cooperative relationships with 52 automobile and machinery manufacturers including SAIC-GM-Wuling, Changan Automobile, and FAW-Jiefang, and participated in 533 types of heat exchanger suppliers. 3) The company's sales volume is second in the industry, and the domestic enterprise is number one. The market share of radiators is 8% to 10%, and the market share of heaters is around 3%, making it the most competitive in the micro car heat exchange market. Future growth highlights: 1) With the launch of independent car brands and the increase in demand for construction machinery and trucks, if capital and production capacity bottlenecks can be solved, the company will break through the traditional micro-vehicle field and make a difference in the fields of cars, heavy trucks, and construction machinery. 2) The company overcame the working problems of EGR technology in a high temperature and pressure environment, and is capable of manufacturing intercoolers for diesel engines that meet Euro4 standards. With the implementation of this standard, exhaust gas recirculation chillers will have a larger market. 3) Based on the advantages of heat exchange technology, enter non-automotive products such as CPU water cooling systems, wall-mounted furnace heat exchangers, and high-pressure radiators for electronic communication equipment, etc., and open up new markets. Profit forecast and valuation: The forecast EPS for 2011-2013 is 1.09, 1.35, and 1.63 yuan, respectively. Based on the valuation of comparable companies in the same industry and the company's position in the industry, we gave the company a valuation of 15 to 18 times, and the corresponding stock price was 16.35 to 19.62 yuan. The company's increase on the first day of listing can reach 5%, and the corresponding price range on the first day of listing is 17.12 to 20.6 yuan. Risk factors: The declining cycle of the automobile industry has compressed the company's product demand; competition in the same industry, especially with joint ventures, is becoming more intense; major customers are too concentrated; SAIC-GM-Wuling, the largest customer, contributed 60% of revenue; rising raw material prices have compressed profits.