Announcement signed a financial leasing agreement: The company and Cinda Leasing signed a “Manufacturer Financial Leasing Business Cooperation Agreement” to jointly carry out financial leasing business cooperation for agricultural machinery products to end customers across the country. The financing amount (that is, the scale of cooperation) for financial leasing services provided by Cinda Leasing does not exceed 150 million yuan. The contract period is one year, and the company assumes responsibility for equipment repurchase in accordance with the relevant contract. The first company in the industry to try financial leasing of agricultural machinery has an innovative model and far-reaching impact: we take agricultural machinery with a price of 1 million as an example. Under the full purchase model, let's assume that the first payment ratio agreed between the farmer and the company is 30%, and the farmer first pays 300,000 in advance when purchasing the machine; after the farmers' qualifications are approved by the company and Cinda Leasing, Cinda Leasing transfers the remaining 700,000 of the purchase amount to the company. Cinda Leasing forms a financial leasing relationship with the farmer in installments. The company makes installment payments to Cinda Leasing in accordance with the contract agreement, and the company urges farmers to pay the equipment and maintenance. repayment. We believe that the company's application of the financial leasing model to agricultural machinery circulation is significant: first, it is the first in the industry to try a financial leasing model, and the demonstration effect is obvious; second, the financial leasing target mainly targets high-end agricultural machinery products with high unit prices, which helps the company to further develop the domestic middle and high-end product market and accelerate the modernization of agricultural machinery; third, in the long run, such a “mortgage loan” model can effectively ease the financial pressure on farmers after “full purchase”, boosting agricultural machinery consumption demand, and has a profound impact on the industry. The industry has a high level of prosperity, broad growth space, and high performance flexibility, and maintaining increased holdings: the premise of agricultural modernization is agricultural machinery modernization, the agricultural machinery industry will usher in a round of favorable policies, and the prospects for the industry are broad; the agricultural machinery distribution sector is in a “blue ocean”. The company, as the industry leader, has a market share of less than 2%, leaving a lot of room for expansion; the company has successfully applied various innovative models such as “franchise chains, agricultural machinery hypermarket management, and supporting value addition” to the agricultural machinery distribution field. The company's brand and channel advantages are gradually strengthened in the field of agricultural machinery distribution; the company's brand and channel advantages are gradually strengthened in the future; “full margin purchasing” The shift in “purchasing machines” and the financial leasing model stimulate high-end agricultural machinery Consumption, reduced upfront capital investment, and the refinancing function of the GEM market may resume in '13, etc., will cause pressure on the company's cash flow to reach an inflection point, and performance flexibility will be high. We expect the company's EPS for 12-14 to be 0.15, 0.22, and 0.28 yuan, corresponding to 45, 30, and 24 times PE. There have been many favorable policies in the industry recently, and the timing for theme investments is appropriate. Give the company an “increase in holdings” rating. Investment risks mainly include failure to ease cash flow pressure, continued decline in the construction machinery sector, and high valuations.