Key investment points: “Industry+Finance”, actively participate in the fixed increase subscription of Longsheng Co., Ltd. The company uses “industry+finance” as the driving force to establish a development model of an industrial investment platform with integration capabilities as its core advantage. While stabilizing mining production, we are continuously speeding up deployment in the field of trade and financial investment business. The company actively participated in the fixed increase subscription of Longsheng Co., Ltd., with a subscription amount of 750 million yuan. After the fixed increase is completed, the company will hold 8.02% of Longsheng shares. Longsheng Co., Ltd. has good profitability. After a fixed increase, it will enter the field of metamaterials to carry out R&D and industrialization projects, and there is plenty of room for future development. The major asset restructuring matters of Peng Xin Resources were reviewed and approved by the M&A and Reorganization Committee of the Securities Regulatory Commission. The company plans to issue about 210 million shares at a price of 8.45 yuan/share and purchase 49.82% of Pengxin Mining Investment's shares, with a transaction consideration of 1.7 billion yuan. At the same time, it raised 1.7 billion yuan of supporting capital at a price of 8.45 yuan/share. Raising supporting capital will invest in the cathode copper and cobalt hydroxide projects of Pengxin Mining Investment and supplement working capital. Join hands with Gerard Metals to expand the business model. In the future, the company will establish a joint venture with Gerard Metal and increase the capital of Gerard Group. In January 2016, the company signed an agreement with Gerard Metals to provide 30,000 tons of copper ore and 7,000 tons of cobalt metal to Pengxin Mining every year for the next 10 years. The cooperation between the two sides will expand the company's business model and shift from “development, smelting and sales of own ores” to “development, smelting and sales of own ore+smelting and sales of purchased ores”. Develop the cathode copper project and expand the company's business scale. The company plans to build a new 20,000 tons/year cathode copper production project at the Situlu copper mine in the Democratic Republic of the Congo (DRC). The total investment of the project is US$144.7024 million, of which: construction investment is US$121.444 million, working capital is US$23.257 million, the construction period is 1 year, and the service period is 10 years. The final product of the project is cathode copper, and the by-product is cobalt hydroxide. The estimated average annual net profit of the project after delivery is US$16.5068 million, and the financial internal rate of return after investment income tax is 15.39%. Lay out a cobalt project to develop gold and cobalt resources in the Congo. The company plans to build a cobalt hydroxide production line with a cobalt metal volume of 7,000 tons/year in two phases. The construction of the project invested 5024.80 million US dollars. The final product of the project is cobalt hydroxide, and the by-product is cathode copper. The project achieved an average annual net profit of US$17.21,66 million, and the financial internal rate of return after investment income tax was 22.32%. Profit forecasting and ratings. The company uses “industry+finance” as the driving force to establish a development model of an industrial investment platform with integration capabilities as its core advantage. Benefiting from the sharp rise in copper prices, the profitability of the company's mineral copper business is expected to improve markedly in 2017, and the fixed increase of Longsheng Co., Ltd. will also increase the company's profitability in the future. Assuming that the company is scheduled to complete the increase in 2017, considering the company's new share capital after the fixed increase, the company's EPS is estimated to be 0.07 yuan/share, 0.13 yuan/share, and 0.17 yuan/share in 2016-18. Taking into account the valuation of the copper and cobalt industry, 80 times PE was given in 2017, with a target price of 10.4 yuan, and an increase in holdings rating. Uncertainty analysis. Fluctuations in copper and cobalt prices affect project profitability.