Key investment matters: The company recently issued an announcement. The company is the winning bidder for the “Linhe District Wetland Restoration and Protection Project EPC Project in Bayannur City”, with a bid amount of 999 million yuan. Ping An's view: Jiangsu landscaping private high-tech enterprise, business structure optimization promotes profitability improvement: Huawang Co., Ltd. is located in Danyang, Jiangsu, and listed as a secondary new stock in August 2016; the company's 2015 operating income was 539 million yuan, and municipal greening and road greening projects accounted for nearly 90% of revenue; before listing, equity incentives were given to core management teams and technical personnel, and executives held a total share of about 4.18%; in April 2016, it was qualified as a high-tech enterprise and enjoyed a 15% income tax rate, while the company's municipal administration (municipal landscaping+road greening) projects accounted for a large share Increased, and profit margins continued to improve. By 2016, the company's net profit margin had increased to 14.97% in Q3. The joint horizontal strategy is clear, and the company is marching into a national integrated garden ecology platform: the company's business is based in Qiandong, and the eastern and northern regions account for 61.78% and 28.58% respectively. Through IPO fund-raising projects, the company will vigorously expand southwest China and other places, and the cross-regional development strategy is clear; at the same time, the company has recently changed its name and expanded its business scope to ecological management, environmental protection and soil restoration, extending the main landscaping business to the ecological environment protection industry. The company's intention is obvious. The company's cross-regional expansion and superposition of the industrial chain strategy will help expand and extend the industry chain strategy. The company developed into a leader in garden ecology. There are plenty of orders in hand, and the number of new orders has exploded, and the company has entered a channel of high performance growth. By the end of 2015, the company had major BT orders of about 433 million yuan, guaranteeing the company's performance in 2016; since August 2016, the company's new orders and PPP framework agreements totaled 2.97 billion yuan, 5.51 times the company's 2015 operating income. Of these, 1.47 billion yuan of construction orders will centrally release performance in 2017, and 1.5 billion yuan PPP orders are conservatively expected to enter the performance release cycle in 2018, and a huge number of new orders have helped the company enter rapid performance growth. The urbanization process, sponge city construction, and PPP policy dividends have been released, and landscape engineering enterprises have once again welcomed the blue ocean. The urbanization rate in 2015 was 56.1%, and there is still plenty of room for improvement compared to 80% in developed countries; at the same time, the annual investment in sponge city construction has brought more than 150 billion yuan to the landscaping market. The Ministry of Finance has invested about 12.6 trillion yuan in PPP projects. Of these, 82.78% of the projects are highly related to landscaping and ecological restoration. The promotion of PPP has brought huge markets to the garden industry, while optimizing business models and reducing the pressure on corporate capital. It is expected that 2017 PPP will enter a major year of performance release. Profit forecast and investment advice: “Small market capitalization, high growth, big strategy” companies were given a “recommended” rating for the first time. Benefiting from urbanization, sponge city construction, and PPP promotion, and taking advantage of its own listed company platform, Huawang Co., Ltd. has signed new orders rapidly. The new orders signed in 2016 were 5.51 times the revenue of 2015. The joint (industrial chain extension) and horizontal (cross-regional expansion) strategy helped the company grow into a comprehensive national garden and ecological platform, and the company entered a rapid growth channel. We expect the company's operating revenue for 2016-2018 to be 602 million yuan, 809 million yuan and 1,169 billion yuan respectively, with year-on-year growth rates of 11.65%, 34.47% and 44.47% respectively; net profit of 89 million yuan, 120 million yuan and 172 million yuan respectively, year-on-year growth rates of 31.6%, 34.6% and 43.4% respectively. EPS for the same period was 0.67 yuan, 0.90 yuan and 1.29 yuan, corresponding to the closing price of January 13, 2017, 2016-2018 Annual PE is 62 times, 46 times, and 32 times, respectively, and PB is 6.3 times, 5.5 times, and 4.7 times, respectively. Before the launch of Huawang Co., Ltd., the core members were fully motivated, and the management and core technical personnel were fully motivated to ensure the implementation of the company's joint and horizontal strategy. At the same time, huge orders will concentrate on releasing performance from 2017. The increase in performance is determined, covering the company for the first time, and giving it a “recommended” rating. Risks indicate risks such as the macroeconomic growth rate falling short of expectations; fixed asset investment growth falling short of expectations; PPP projects not progressing as expected; the implementation of the company's cross-regional expansion projects falling short of expectations; the risk of bad debts on accounts receivable; and the extension of the company's industrial chain falling short of expectations.