Matters: The company issued an announcement. The application for non-public issuance has been reviewed and approved by the CSRC. No written approval documents from the CSRC have been received yet. Peace view: The approval time for the adjustment plan is in line with expectations, and the issue price is likely to be higher than the reserve price of the issue. On September 6, the company announced adjustments to the plan for the non-public offering of shares. The subscription targets were Investment Group, Fortune Palace Plan, and Ecological Plan No. 1. The subscription amount was 720 million yuan, and the issue price was 70% of the average transaction price for the 20 trading days before issuance or 12.14 yuan/share; previously, we expected that it would take at least 2-3 months from the adjustment of the non-public issuance plan to completion. The review and approval cycle is in line with our expectations; the company's average price on the last 20 days is 23.76 yuan. Based on this calculation, 70% is 16.632 yuan. Judging from the company's stock price performance, it is estimated that the issuance price rate will probably be higher than the bottom price of the issuance price , the repricing will reduce the dilution of EPS. The “debt-for-equity” non-public issuance plan combined with employee stock ownership plans was launched at the same time, optimizing the financial structure while stimulating employee motivation. The company plans to raise 720 million yuan in non-public issuance plans, and expects to raise 470 million yuan to repay loans authorized by the Investment Group and 250 million yuan to supplement liquidity; after this issuance, the company's balance ratio is expected to drop from 69.34% to 50.36%, saving about 6.9 million yuan in financial costs every year, accounting for 27% of the company's financial expenses reported in 2016. Financial structure optimization helps restore the company's profitability; at the same time, on September 6, the company launched an employee stock ownership plan. The total amount is no more than 9.9 million yuan, and the number of subscribed shares does not exceed 815,500 shares. The number of participants is limited to 43 million. 3 years; The participants in the employee stock ownership plan include 5 executives and 38 core business executives. The subscription price principle is not lower than the current non-public offering price. This employee stock ownership plan will help stimulate the motivation of core personnel and further promote the continuous improvement of the company's performance. The results of the three-quarter report continued to reverse, profit levels improved markedly, and accelerated orders guaranteed a high increase in performance. The company's operating income for the first three quarters was 662 million yuan, up 17.73% year on year, net profit was 34 million yuan, up 598.58% year on year; during the same period, the company's gross profit margin was 31.89%, net profit margin was 5.20%, up 3.77 percentage points and 4.32 percentage points, respectively, and profitability improved markedly; at the same time, from the company's announcement of the order situation, new orders of 1.91 billion yuan from January to September 2016 were added, of which construction engineering business was about 590 million yuan, PPP business orders of 1.32 billion yuan. Additionally, the company owned 2.5 billion yuan PPP projects in Tonghai County The framework agreement, the company's orders have been significantly increased, and PPP projects have accelerated, ensuring high growth. Investment suggestions: In 2016-2018, the company's operating income is estimated to be 1,223 billion yuan, 1,712 billion yuan and 2,311 billion yuan respectively, and earnings per share of 0.39 yuan, 0.50 yuan and 0.74 yuan, corresponding to the closing price on November 2. Dynamic PE is 60.0 times, 46.3 times and 31.4 times, and PB is 4.8 times, 4.4 times and 3.8 times, respectively. This non-public offering successfully optimized the company's asset structure, reduced the company's financial costs and helped restore profitability. At the same time, the company launched an employee stock ownership plan to stimulate the motivation of core members and help the company grow. We are optimistic about the elasticity of the company's performance, the company's ability to obtain orders, its position as a large ecological platform, and future state-owned enterprise reform space, and maintain the “recommended” rating for the company. Risk warning: accounts receivable recovery risks, orders falling short of expectations, slow expansion of extensions, progress in state-owned enterprise reform falling short of expectations, etc.