Key investment points: In 2016, we turned a loss into a profit and achieved net profit of 58 million yuan. The company achieved revenue of 13.916 billion yuan in 2016, up 43.29% over the same period, mainly due to an increase in coal business and trade business revenue. Among them, coal business revenue was 238 million yuan, up 90.40% year on year; trade business revenue was 4.870 billion yuan, up 382.66% year on year; net profit was 58 million yuan, and net profit was 116 million yuan in the fourth quarter, mainly due to the large increase in raw coal prices in the fourth quarter. The subsidiary Zhongfu Electric Power's own electricity generation costs were high. The advantages of “coal-electricity-aluminum-aluminum deep processing” are obvious. Through the integration and optimization of upstream and downstream resources, the company has now formed an integrated industrial chain of “coal-electricity-aluminum-aluminum deep processing”, which mainly focuses on deep processing of aluminum. In 2016, the company has an electrolytic aluminum production capacity of 740 million tons, an aluminum processing capacity of 75,000 tons, a coal production capacity of 2.55 million tons, and a carbon production capacity of 150,000 tons. The cost advantage of electrolytic aluminum is obvious. The company's main raw materials are alumina, electricity, coal and carbon. Except for the outsourcing of all alumina, all other raw materials have achieved varying degrees of self-sufficiency. More than 94% of the electricity required for production at the company headquarters was purchased from the subsidiary Zhongfu Electric Power, which has 3 thermal motor assembly machines with a capacity of 900,000 kilowatts; the subsidiary Lin Feng Aluminum Electric has become a direct power supply pilot unit since September 2013, and electricity costs have continued to decrease. In 2016, the company's coal self-sufficiency rate was about 20%, and most of the coal was exported. In the future, by increasing the coal self-use rate, the production cost of electrolytic aluminum can be further reduced. 85% of the carbon required for production at the company headquarters was purchased from Zhongfu Carbon, and all carbon required for production by the subsidiary Lin Feng Aluminum Electric was outsourced. Production capacity for aluminum processing has been greatly increased. In 2015, a high-performance aluminum alloy special aluminum project covering a high-precision aluminum plate strip cold rolling project with an annual output of 130,000 tons and a high-performance special aluminum project with an annual output of 50,000 tons was put into production, enabling the company to have an annual aluminum processing capacity of 75,000 tons, an increase of 78.57% over 2014. It is mainly used to produce high strength and high toughness alloy medium and thick plates for aerospace, petrochemical, transportation and other industries, and has completed the initial transformation from an electrolytic aluminum manufacturer to an aluminum processing manufacturer. We are determined to improve the military IDC, and future performance can be expected. The company plans to issue no more than 553.6028 million shares in non-public shares at a price of 569 yuan/share and raise no more than 3.150 billion yuan in capital for the construction of a cloud computing data center project in Henan. The revenue from the project mainly comes from cabinet and server rent, etc. It is estimated that within 10 years (including the construction period), it will achieve a cumulative operating income of 6.273 billion yuan, a cumulative net profit of 2.128 billion yuan, and a payback period of 5.48 years (including the construction period). It is expected that the economic benefits will be good, which will effectively increase the company's profit level. Profit forecasts and ratings. The way the company operates throughout the industry chain can reduce the impact of fluctuations in upstream product prices on the company's profits. It has cost advantages and strong risk resistance. At the same time, the company plans to enter the IDC market through a non-public offering of shares, develop new industries, and add new profit growth points. Therefore, we expect the 2017-2019 EPS to be 0.23 yuan, 0.31 yuan, and 0.41 yuan, respectively. Taking into account the average valuation level of the industry, a valuation of 30 times that of 2017 was given, with a target price of 6.9 yuan and a purchase rating. Uncertainty analysis. Risk of fluctuations in aluminum prices; risk of fixed increase transactions; market risk, etc.