Core view: Acquire Changshu Yabang and enter the military industry. On January 5, 2017, Guangli Technology announced that it plans to acquire 100% of Changshu Yabang's shares for 176 million yuan, of which 151 million yuan will be paid by issuing shares (20.01 yuan/share, 7.51 million shares issued) and 25 million yuan in cash. At the same time, 40 million yuan of supporting capital was raised, mainly for the cash consideration portion and related taxes. Changshu Yabang: Electronic control system supplier in Zhouqiao. Changshu Yabang is currently the main supplier of electronic control systems and training simulators for military engineering equipment (pontoons and bridges) in China. It has been designed by the military to define type 4 water and land pontoon bridge electronic control systems and type 2 boat bridge training simulators, and has obtained the “Weapons and Equipment Quality Management System Certification”, “Level 3 Confidentiality Qualification Unit Certificate”, and “Equipment Production Unit Registration Certificate”. Civil-military integration continues to advance, and relevant policies favor civilian participation in military enterprises. In March 2015, General Secretary **** first proposed “elevating the development of civil-military integration into a national strategy,” and the Politburo meeting of the CPC Central Committee held in March 2016 officially elevated the development of civil-military integration into a national strategy. In July, the CPC Central Committee, the State Council, and the Central Military Commission raised “Opinions on the Integrated Development of Financial Development and National Defense Construction”. The profitability of listed companies will improve. Listed companies have experienced a decline in performance in the past two years due to the continued downturn in the coal industry. Changshu Yabang's promised performance for 2016-2018 is 11.5 million yuan, 15 million yuan, and 17.75 million yuan respectively. Through this asset acquisition, the operating conditions of listed companies are expected to be further improved, while entering the military industry with good development prospects. Profit forecast and investment advice: Regardless of this non-public offering, we expect the company's 2016-18 EPS to be 0.14/0.17/0.18 yuan. Considering Changshu Yabang's good development prospects in the military field, it covered it for the first time, and gave the company a “prudent increase in holdings” rating. Risk warning: The progress of non-public offerings falls short of expectations, Changshu Yabang's performance falls short of expectations, and the prosperity of the coal industry continues to decline.