Report summary: The company is the world's leading manufacturer of steel for prestressed concrete, and is also a leading manufacturer of high-speed rail track boards in China. The company adheres to the development concept of leading technology and continuous innovation. The products are mainly aimed at railway, water and export markets. The company's prestressed steel business benefited from a recovery in prosperity. Since 2017, benefiting from national infrastructure investment and “Belt and Road” investment, the prestressed steel industry has broken out of its trough. According to information, demand for prestressed steel is strong in the market. Since the price increase in the fourth quarter of 2016, the price was raised again in the first quarter of this year. As an industry leader, the company will benefit from a recovery in industry prosperity. The company's track board business is developing well. 1) The company's high-speed rail track board production technology is at the leading level. The company's current Beijing-Shenyang high-speed railway track board business is running well, and will continue to be settled until '17. 2) The company set up a joint venture rail board company with the Shanghai Railway Administration, etc., to achieve effective complementarity of resources and win-win cooperation. It is expected that it will be exported to intercity railway construction in the future. 3) The ballastless subway track board market space is huge. The domestic market has already started, the company's technology research and development is at the leading level, and is expected to explode in the future. The company cooperated with Hangang Steel to enter the railway rail market. Railway rails are consumables with large market space and high gross margin. The market is mainly supplied by Baogang, Angang Steel, Pangang and WISCO. The cooperation between the company and Hangang Steel can not only make full use of the company's technology research and development and railway industry experience, but also make full use of Hangang Steel's advanced production equipment and experience. Therefore, we are optimistic that the company will cooperate with Han Steel to enter the railway rail market. Company profit forecast and investment advice. We expect the company's operating income from 2016 to 2018 to be 1.2 billion yuan, 1.53 billion yuan and 1.84 billion yuan respectively, and corresponding earnings per share of 0.32 yuan, 0.47 yuan and 0.59 yuan respectively. The company's stock price corresponding to 16-18 PE was 46 times, 31 times, and 25 times, respectively. First coverage, giving the company a “highly recommended” rating. Referring to the 2016 valuations of similar companies in the same industry, the company was given a target price of 18 yuan for 6 months. Risk warning: risk of macroeconomic fluctuations, raw material price fluctuations, and policy changes related to railway and water conservancy construction.