Yulin Chuanneng Huaxi is a waste-to-energy project company in Yulin, and this capital increase is beneficial to the project's profit contribution to the company. Yulin Chuaneng Huaxi is a project company set up as a joint venture between the company and Sichuan Energy Investment Huaxi Biomass Development Co., Ltd. to implement the Yulin waste-to-energy BOT project. According to the regulations of Yulin Chuaneng Huaxi Environmental Power Generation Co., Ltd., the registered capital of Yulin Chuaneng Huaxi is 100 million yuan, of which Huaxi Energy has pledged 49 million yuan, and Huaxi Energy has pledged 51 million yuan of investment. Since Sichuan Energy Investment Huaxi Biomass Development Co., Ltd. has decided to relinquish 51% of its investment rights in Yulin Chuaneng Huaxi, in order to promote the smooth progress of investment and construction of the Yulin waste-to-energy BOT project, after friendly negotiations among all parties concerned, 51 million yuan of investment pledged and invested by Huaxi Energy was pledged by Huaxi Energy. After this capital increase is completed, Yulin Chuanneng Huaxi will become a wholly-owned subsidiary of Huaxi Energy. The planned construction scale of the Yulin waste incineration BOT power generation project processes 1,200 tons of garbage per day. After completion and operation, the project is expected to generate good profits and stable cash flow. The company currently has its own waste-to-energy project of 4,400 tons/day, plus the Bohai Xinneng project, which has a total treatment capacity of 1,1550 tons/day, leading the scale of waste incineration power generation in China. This capital increase is conducive to promoting the continuation of project construction, promoting the completion and operation of the project as soon as possible, strengthening the centralized control of project investment, construction and operation, and improving overall efficiency. In the future, after the project enters the construction and operation period, it will increase its profit contribution to the company, which will have a positive effect on the company's performance growth. Continue to maintain a highly recommended rating. We expect the company's EPS in 16, 17, and 18 (including Hengli Shengtai's investment income) to be 0.32 yuan, 0.55 yuan, and 0.8 yuan respectively. In the future, the company will gradually enter a fast track of performance growth, which is a target worth continuing to track, and we will continue to maintain our “highly recommended” rating.