Investment points: The company's gross margin level has been increasing year by year, the business structure has been continuously improved, and the share of the company's OEM contract business in revenue has declined year by year, and the share of high-margin ODM business has gradually increased. From home lighting to common development of home lighting, engineering lighting, and landscape lighting, etc., the company's gross margin can increase year by year, from less than 20% to 27.54% in 2016. The incentive mechanism has been strengthened, the company's management level has been improved, and subsidiaries are divided into different units responsible for each key regional market. Important customers in each region have received attention, which is conducive to market development. At the same time, equity incentives are given to subsidiary management teams to enhance team sales capabilities. Benefiting from the steady development of the global LED lighting market, performance continues to grow, and the global LED lighting market stock penetration rate is only about 12%, the incremental market penetration rate is just over 30%, growth is steady, and the average annual growth of domestic and foreign lighting markets is close to 20%. As an important global lighting company, the company will continue to benefit from the increase in demand in the global lighting market, and the company's revenue will continue to grow. Profit forecasting that the company's lighting product revenue growth mainly benefits from the growth of the global LED lighting market and the company's rhythmic expansion of production. In the last two years, the company has effectively improved management levels, formulated a reasonable incentive mechanism, and expanded its share of high-margin business. We expect EPS in 2017-2019 to be 0.33/0.36/0.40 yuan, corresponding to PE 20.20/18.21/16.48 times, respectively, covering the company's “increased holdings” investment rating for the first time. Risks indicate that market demand falls short of expectations, the company's gross margin falls, and the risk of exchange rate fluctuations.