Leading domestic air conditioning fan blade company. Shunwei Co., Ltd. is mainly engaged in R&D, production, and sales of plastic air conditioning fans. Its products include cross-flow fans, axial fans, centrifugal fans, etc. Downstream customers are mainly domestic and international air conditioning companies. The company has now received 80-100% domestic orders from foreign customers such as Panasonic and Daikin over many years, and is the largest supplier of Gree and Midea, leading domestic air conditioning industry leaders, and has received an average of 30-45% orders per year. In the past three years, the company's air conditioning fans have had a market share of more than 25% in the domestic market, ranking first in the country. Shunwei Co., Ltd. has strong technological and industrial chain advantages. The company is one of the earliest enterprises specializing in the production of plastic air conditioning fans in China. It has conducted more than ten years of research on the structure, leaf shape, wind channel characteristics, flow field, etc. of air conditioning blades, and has established a provincial engineering technology research and development center. At the same time, the company has a complete industrial chain advantage. In addition to plastic air conditioning fans, the company's main business includes the design, production, processing and manufacturing of modified plastics and mold development, making it one of the few professional plastic air conditioning fan manufacturers with comprehensive supporting capabilities in the industry. The growth rate of the air conditioning industry has slowed in the short term, and there is still plenty of room for growth in the long term. 2010 was a year of rapid development for the air conditioning industry. The growth rate of the air conditioning industry slowed in 2011, and air conditioning production in Q2012 had a negative increase of 1.23%; at present, the number of air conditioners owned by 100 people in China still has a lot of room for improvement compared to foreign countries, and it is expected that the long-term air conditioning industry still has a lot of room for development. Analysis of recruitment projects. The company plans to issue 40 million shares and raise 358 million yuan in capital. The capital raised will mainly be used for four projects, namely the Shunde headquarters renovation and expansion project, the Kunshan relocation and expansion project, the Wuhu new capacity expansion project, and the establishment of a research and development center. After the completion of the project, the company will add 29 million units/year of production capacity. In 2011, the company sold 71.808 million air conditioning fan blades, yet the company's actual production capacity was only 54 million units/year. The insufficient production capacity was all produced through outsourcing. We believe that the fund-raising project will help ease the company's production capacity bottleneck and further enhance the company's position in the industry. Profit forecasts and investment advice. We expect the 2012-2014 EPS of Sunway Co., Ltd. to be 0.73, 1.01, and 1.36 yuan respectively. Based on the company's growth over the next three years and comparable company valuations, we recommend giving the company a more reasonable dynamic price-earnings ratio of 15-18 times in 2012, corresponding to the valuation range of 10.95-13.14 yuan/share, and the recommended inquiry range is 9.85-11.82 yuan/share. Risk warning: 1) Risk of economic fluctuations in the air conditioning industry; 2) Risk of fluctuations in raw material prices