Research conclusion The company is a domestic overall solution provider in the field of electrical contact functional composites, mainly engaged in R&D, production and sales of electrical contact functional composites, components and components. In recent years, the company has been in a stage of rapid growth. In 2008-2010, operating income increased by 63.93%, net profit increased by 122.60%, operating income from January to June 2011 increased by 121.70% over the same period last year, and net profit increased by 198.69% over the same period last year. Currently, the main products are divided into three categories: granular and fiber-reinforced electrical contact functional composites and components, layered composite electrical contact functional composites and components, and integrated electrical contact components. The main business revenue in 2010 accounted for 30.96%, 26.97%, and 42.07%, respectively. It has strong R & D and independent innovation capabilities. In recent years, the company has participated in drafting or revising 3 national standards, 39 industry standards, 3 products have been rated as products with trustworthy quality by the China Electric Appliance Industry Association, 2 products have been certified as new provincial industrial products by the Zhejiang Economic and Trade Commission, and 18 authorized invention patents have been granted. On the one hand, the company's core technology is used to prepare environmentally friendly composites with electrical contact functions, and on the other hand, it saves the amount of precious metal silver used in electrical contact materials, improves the accuracy of the electrical contact preparation process, and recycles waste generated from initial processing to reduce production costs. It has a complete product line and system solutions. As a leading overall solution provider in the field of electrical contact functional composites in China, the company has a complete product system from the preparation of various electrical contact materials to the processing of integrated electrical contact components, which can meet the performance requirements of all low voltage electrical appliances. Currently, the company produces three categories of various electrical contact material products with more than 5,000 specifications, with a complete product line of electrical contact materials, from the development of various electrical contact functional composite components to large-scale production, to the precision processing of integrated electrical contact components. It provides customers with system solutions with more cost advantages while cooperating with customers Jointly complete the development of new products or applications. High quality and stable customer resources, and the gradual expansion of customer orders. The company's competitive advantage in terms of technology, quality and cost has made the company a supplier to well-known domestic and foreign low voltage electrical appliance manufacturers. It has won the recognition and trust of high-quality customers such as Zhengtai Electric, Delixi Electric, Emerson, Sensata, Cooper, and General Electric, and customer orders have gradually expanded. The strict supplier qualification certification of these well-known domestic and foreign customers, as well as the stable customer relationships formed based on long-term cooperation, have formed a strong barrier to customer resources. The fund-raising project will resolve production capacity bottlenecks and further optimize product layout. This time, the company raised capital of about 299.903 million yuan to invest in an automated production line project for layered composite electrical contact functional composites and components with an annual output of 550 tons, and a project for granular and fiber-reinforced electrical contact functional composites and components with an annual output of 105 tons. After the completion of the project, it will greatly enhance the production capacity of the company's various products, fundamentally resolve the contradiction between insufficient production capacity, and further improve profitability through product structure improvements. We expect the company's EPS for 2011-2013 to be 1.14 yuan, 1.48 yuan, and 1.83 yuan, respectively. Combining the company's growth and the average level of the industry it belongs to, the corresponding reasonable valuation range is 28.5-34.2 yuan based on the company's 25-30 times PE in 2011. Risk factors: The company may be at risk of customer concentration and the risk of fluctuations in raw material prices.