Incident: The company issued an announcement on February 20 to terminate and withdraw the 2015 A-share fixed increase. After the plan was adjusted, it re-declared its plan to increase Weihai Poly and Poly by 1.07 billion yuan. It is estimated that after the fixed increase is completed, Poly will hold a cumulative total of 6.59% of the shares. Joining hands with the two giants of the China Military Engineering Group: the company increased 1.07 billion dollars to invest in military special vehicles and exoskeleton robots, and the target general partners were all Poly Defense. Among them, the Weihai Poly Limited Partner is the China Ordnance Industry Group. After the successful issuance, the Poly Department will hold 6.59% of the shares and become the company's second shareholder. The in-depth cooperation after the introduction of the two major military enterprise groups is worth looking forward to. In-depth cooperation in various fields in the military industry: the company signed a strategic agreement with Poly Defense in September 2016: Poly Defense Investment plans for the company to connect with business opportunities related to the company in building overseas defense bases; the company and the Poly Defense Fund achieve comprehensive resource sharing and strategic cooperation (now they have pledged 200 million dollars to the Poly Defense Fund). The company introduced a military giant with a central enterprise background as a private enterprise, and the possibility and space for implementation received important support. It is recommended that continued attention be paid to subsequent catalysis. The foundation of the main real estate business is consolidated and continuous breakthroughs are expected, and high performance growth can be expected: in 2014, the company received full injection into the real estate development business of Bank of China Holdings, the majority shareholder, through a fixed increase, and since then it has established a two-wheel drive layout for major real estate business+special vehicles. The company's real estate sales in 2016 are about 23 billion yuan, which will advance into the 30 billion tier. At the same time, this year's real estate distribution will continue to increase the Shanghai region, Nanjing, Hangzhou, Suzhou and other places, making reserves healthier; the company's announcement revealed that the full-year performance growth rate for 2016 was about 60%-80%; in addition, the company has also introduced equity incentives. The next three years of performance will maintain a growth rate of at least 10%, 20%, and 30% compared to the average performance in 13-15 years (348 million). National defense and military industry have broad prospects, and civil-military integration opens up space: the Third Plenary Session of the 18th Central Committee proposed a shift in national defense strategy from active defense to a combination of offense and defense. After that, the development of integrated military and civilian development was upgraded to a national strategy, defense spending was 908.7 billion yuan in 2015, an increase of 9.63% over the previous year, and defense spending at this level increased 7.61% year on year. There is still plenty of room for future investment in national defense. As a national key high-tech enterprise, the company has long ranked first in the domestic market share in the field of bulletproof special vehicles. With excellent military vehicle R&D and production capabilities and experience, along with the advantages of resource sharing and strategic cooperation with military giant Poly Defense, the company's new military special vehicles have good sales prospects. Furthermore, the state has introduced a series of support policies to encourage the development of robot-related industries. Exoskeleton robots can be widely used in military fields such as military and public safety, as well as in civilian fields such as medical rehabilitation, etc., so there is room for future market demand. Investment suggestions: The foundation of the company's main real estate business is consolidated, and performance continues to break through, bringing stable cash returns to the company. The company reported the new plan as soon as the new fixed increase policy came out. Although it is a real estate company, the fundraising direction for fixed increase projects is military technology, and it is not within the scope of restrictions on real estate refinancing. With the company's strong accumulation in the military industry over many years and the benefits of reaching strategic cooperation with Poly Defense, we continue to be optimistic about the company's long-term development. We expect the company's EPS in 16-18 to be 0.33, 0.45, and 0.58, respectively, and the target price for 6 months is 10.6 yuan. Maintain a buy-A rating. Risk warning: Refinancing policy risks, failure to meet performance targets.