Matters: Today, the company issued an announcement: the actual controller and chairman of the company, Ms. Mao Fengli, and the company's directors, supervisors and senior management (management team) intend to increase the company's shares through the Shenzhen Stock Exchange trading system within 12 months from the date of disclosure of the announcement. The minimum amount of the planned increase is 100 million yuan, the maximum increase in holdings is 1 billion yuan, and the maximum increase price is 15 yuan/share. Comment: The actual controller and executives plan to increase their holdings by a large percentage, showing confidence. In June 2016, Fengli Wealth acquired 91.96% of the shares of the former controlling shareholder of the company for 850 million yuan, and indirectly obtained 21 million shares of the listed company, accounting for 29.46% of the total share capital of the listed company, and became the controlling shareholder. The actual controller of the company also changed to natural person Mao Fengli. After this acquisition, the actual controller thoroughly sorted out the company's management and business. In June 2016, the company transferred 100% of the shares of Xinjiang Junchuang Energy Equipment Co., Ltd., a subsidiary with consecutive losses, to Tianjin Fengli for 46.5 million yuan, and completely divested the loss-making business. The 2016 report is expected to drastically account for bad debts and asset impairment losses, leaving the burden of losses behind in one go to battle lightly. The company has a broad presence in the field of environmental protection. Currently, it mainly has environmental protection businesses such as boiler energy saving, combustion control business (Wuhan Fuel Control, Xuzhou Fuel Control Institute), flue gas treatment business (blue sky environmental protection), and water treatment business (Innogreen), etc., with great potential for performance. On April 8, 2017, the company announced the first quarter results forecast. It is expected to achieve a profit of 23.16 million to 28.16 million, turning a loss into a profit. The improvement in business revenue mainly comes from Blue Sky Environmental's large order confirmation revenue and an increase in the parent company's energy-saving ignition business. The company's business potential can be seen. At the same time, the company completed the first phase of the equity incentive plan in March 2017, granting 12.68 million shares to 182 people at a price of 7.53 yuan, gathering the company's internal strength. Recently, the company's management has gradually been put in place, and Chang Yongbin and Li Junxing were newly hired as deputy general managers in April. This increase in holdings binds management's interests to the company's performance. The maximum increase in holdings is 15 yuan/share, which is close to double the current share price. The maximum increase in total holdings is 1 billion yuan, accounting for 15.75% of the company's total market value, fully demonstrating management confidence. Strong financing capabilities help obtain PPP orders, and set up an industrial fund to help epitaxial with the new controller's good reputation and financial strength. In January 2017, Kerong Environment signed a comprehensive strategic cooperation agreement with Bank of Jiangsu Co., Ltd. Xuzhou Branch. The Bank of Jiangsu gave the company an intentional comprehensive financing amount of RMB 5 billion over the five years of 2017-2021. On October 25, 2016, the Fengli Wealth Environmental Protection Industry M&A Fund project initiated by Fengli Wealth (Beijing) International Capital Management Co., Ltd. was successfully signed and implemented with an investment scale of over 1 billion yuan. In March 2017, the company also announced that it plans to jointly launch an industrial investment fund with a total scale of 2 billion yuan with Shenzhen Qianhai Qinzhi International Capital Management Co., Ltd. to invest in environmental protection industry mergers and acquisitions and PPP. Investing in environmental protection projects through industrial funds and injecting them into listed companies in the future is one of the important ways for companies to expand in the future. The company's epitaxial growth can be expected in the future, and there are many highlights. The company's management has increased its wealth significantly, demonstrating confidence in the company's future development. The company is reborn and incentives are in place. It is expected that with strong capital operation capabilities and social resources, it will help obtain PPP orders and expand the company's outreach. Without considering the company's extension, we expect the company's net profit attributable to be -1.13/1.69/238 million yuan respectively for 16-18, maintaining a “buy” rating.