Basic situation of the company: Longzhou Co., Ltd. is a large-scale road transport enterprise in Fujian Province. The company is mainly engaged in automobile passenger transport, freight, passenger terminal operation and related automobile sales and maintenance, refined oil sales, and transportation vocational education and training. The operating units are distributed in 19 counties (districts), including the Longyan and Nanping regions of Fujian Province and Shangrao City in Jiangxi Province. Industry background: Fujian Expressway “11th Five-Year Plan” completed a total investment of 121,181 billion yuan, an average annual increase of 44%, and plans to complete highway construction investment of 48 billion yuan in 2012. Longyan and Nanping are located at the junction of the three provinces of Fujian, Guangdong, Fujian, Zhejiang, and Jiangxi, and the tourism industry clusters on the southwest and northwest sides of the Haixi region, respectively. Moreover, the region is a typical mountainous and hilly area, making it more suitable for the development of automobile transportation services. Competitive advantages: 1) It has an absolute advantage in the passenger transport markets in Longyan and Nanping, and also has a competitive advantage in Fujian Province; 2) the company's shuttle passenger transport and tourist passenger transport have fully achieved corporate management; 3) the industry chain has been fully extended, forming multiple profit growth points; 4) the company's successful acquisition experience supports the company's external development; 5) it forms a relatively complete integrated information platform for road transport enterprises. Fund-raising projects: The funds raised will be used for passenger transportation, freight vehicle launch, the renovation and construction of the main hub of the Longyan Highway, and the construction of a logistics center in Wuping. After the completion of the project, it is expected that the company's profitability will increase to a large extent. Valuation situation: It is predicted that the company's EPS for 2012-2014 will be 0.64 yuan, 0.73 yuan, and 0.85 yuan, respectively. Referring to the valuation level of listed companies whose business is similar to that of the company, we believe that it is reasonable to give the company a price-earnings ratio of 16-19 times in 2012. The corresponding price is 10.24-12.16 yuan, so we recommend purchasing. Risk warning: 1) rapid rail diversion; 2) rising oil prices.