Key investment events: The company recently released its semi-annual report. In the first half of the year, the company achieved revenue of 464 million yuan, an increase of 30.91% over the previous year; net profit attributable to shareholders of listed companies was 71.8 million yuan, a sharp increase of 129.24% over the previous year. On the 3rd, the company announced that its subsidiary had signed a major contract totaling 30.5 million US dollars. The comments on this are as follows: Comment: The high increase in performance in the interim report is mainly due to the merger of Xiamen Perting. In the first half of the year, the company achieved revenue of 464 million yuan, an increase of 30.91% year on year; net profit attributable to shareholders of listed companies was 71.8 million yuan, a sharp increase of 129.24% year on year. The sharp increase in profits was mainly due to the merger of Xiamen Perting. On February 29, 80% of the shares in Xiamen Proting, a merger and acquisition, were transferred. As a result, Xiamen Proting became a wholly-owned subsidiary of 3D Silk. In the first half of the year, Xiamen Perting contributed 249.5577 million yuan in revenue, accounting for 53.80% of the operating income in the reporting period; contributed 49.5564 million yuan to net profit, accounting for 69.02%. Xiamen Perting is mainly engaged in bulk material transportation and storage, and its revenue structure is mainly based on overseas businesses such as Vietnam and the Philippines. Performance commitment: Deduction of non-net profit of 0.97/131 million yuan in 2016-2017. Revenue side: Businesses related to Pelting in Xiamen contributed to an increase in revenue, and the traditional main business declined. In the first half of the year, the company's filter business achieved revenue of 135 million yuan, a year-on-year decline of 33.82%. The gross profit margin was 29.06%, down 2.31% year on year, mainly due to intense low-end and disorderly competition in the filter industry; the environmental engineering business achieved revenue of 7.12 million yuan, a sharp drop of 95.18% year on year, and the gross profit margin remained unchanged, mainly due to not undertaking environmental engineering projects in the first half of 2016; due to epitaxial acquisitions and new environmental protection equipment business, the business achieved revenue of 66 million yuan and a gross profit margin of 48.75% in the first half of the year; the additional bulk material transportation and storage system business achieved revenue of 240 million yuan and a gross profit margin of 30.35%. The increase in corporate expenses is mainly due to mergers and acquisitions of companies and mergers. In the first half of the year, the company incurred financial expenses of 4.55 million yuan, an increase of 18.07% over the previous year, accounting for a relatively small amount; administrative expenses of 46.18 million yuan, an increase of 94.54% over the previous year, mainly due to the merger of Xiamen Perting and Roca Environmental Protection; sales expenses of 26.83 million yuan, an increase of 38.79%, mainly due to the merger of Xiamen Perting. Large orders have been placed continuously, and there are plenty of orders in hand. In July, Xiamen Peting signed a $1.03 million Taishuo Heavy Industries deal. On September 9, Xiamen Poting once again signed two business contracts with Formosa Plastics Group's American affiliates, totaling 30.5 million US dollars (1 equipment sales contract, worth 20 million US dollars, 1 installation and construction contract, amounting to 10.5 million US dollars). Xiamen Perting currently has more than 1 billion orders in hand, and the performance may have exceeded expectations! A 500 million yuan merger and acquisition fund was established to accelerate outreach and achieve full front-end and back-end coverage of clean energy. 1) Capital increase merger and acquisition of Zhongxin Biomass: On October 14, 2015, the company announced that it plans to increase the capital to Zhongxin Biomass by 24 million yuan. After the transaction is completed, it will hold 60% of Zhongxin's shares. 2) Capital increase merger and acquisition of Shengfa Environmental Protection, a low-cost zero-emission pioneer in desulfurization wastewater: On December 4, 2015, the company announced that it plans to increase the capital to Shengfa Environmental Protection by 10 million. After the transaction is completed, it will hold 5% of Shengfa Environmental Protection's shares. Shengfa Environmental Protection uses waste heat from power plant boilers at low cost to solve “zero emissions” of desulfurization wastewater, and the market space is huge. 3) Full coverage of the front and back end. This is the only one: the coal-fired emissions have officially been upgraded, and clean energy is imperative. Through Xiamen Pating, the company can make its own leading front-end bulk material transportation and storage systems; through Roca Environmental Protection and headquarters, the company can provide high-quality back-end flue gas treatment services. The company invested 100 million yuan to participate in the establishment of a 500 million yuan Huaxin-3D Wire environmental merger and acquisition fund to accelerate outreach. Investment advice: Maintain an increase in holdings rating. Currently, the company's additional supporting capital raised has been approved by the Securities Regulatory Commission. The corresponding share capital for exam preparation is 378 million shares, and the market value for exam preparation is 7.5 billion yuan. We predict that the net profit of 3D Silk will reach 17/220 million yuan from 16 to 17, and the corresponding exam preparation valuations will be 44 times and 34 times, respectively. Xiamen Perting's current orders have exceeded 1 billion dollars, and the performance may have exceeded expectations. The establishment of a 500 million yuan merger and acquisition fund accelerates outreach. Currently, the company's stock price is 19.92 yuan/share, which is close to the supporting financing price of 17.71 yuan/share, which is lower than the 19.21 yuan/share increase price for major shareholders. The current price security is strong. Based on this, the Accumulation Rating is maintained. Risk warning: Dust removal and filter business continues to decline