Xinko Electronics's customer expansion has accelerated, and multiple products are about to be launched. Xingke Electronics, a subsidiary of Jubilee Technology, has been actively expanding its customers this year, diversifying its customer and product composition, and achieved remarkable results in the second half of the year, especially in the fourth quarter. In addition to its original customer LeTV, Xingke Electronics now also includes major customers such as OPPO, vivo, and Xiaomi, and has already made prototyping products. From the middle to late fourth quarter to the beginning of next year, related products will soon begin to be shipped in batches to mass production, and there are plenty of orders from major customers. In addition, the company also includes customers such as Hammer, TCL, Meitu, and OnePlus. Xingke Electronics' strength in the field of stainless steel products is absolutely leading in China, and future product standards will continue to move closer to Apple phone requirements. Apple's new model next year is likely to use a “double-sided glass+stainless steel frame” fuselage design. If the expected plan is true, it will bring opportunities for the company's high performance growth next year. The company also introduced a large number of new customer projects at the same time, putting some pressure on short-term performance, but from the perspective of the company's long-term performance growth, the shift from a single customer to a multi-customer structure is worth the short-term effort. In the future, the company plans to gradually reduce LeTV's share in the company's products, achieve diversification of customers and products, and enhance the stability and overall competitive strength of the company's CNC business. After the bottom of the valuation highlights a combination of buying opportunities, we expect Jubilee Technology's annual exam preparation profit to be 42-450 million yuan. The stock price PE after considering additional dilution is less than 25 times, so the buying opportunity is clear. The valuation is calculated based on the share capital after issuance. We predict that the 2016-2018 EPS will be 0.901, 1.514, and 2.153 yuan respectively, and the corresponding PE will be 23X, 14X, and 9X, maintaining the “buy” rating. Xingke Electronics, a subsidiary of Jubilee Technology, has been actively expanding its customers and diversifying its customer and product composition this year. With the maturity of its CNC full-process process, it has gradually entered the ranks of first-class domestic manufacturers. Its product strength continues to be recognized by more and more market customers, and customer expansion achieved obvious results in the second half of the year, especially in the fourth quarter. According to our research, in addition to our original customer LeTV, Xingke Electronics has now successfully entered major customers, including OPPO, vivo, and Xiaomi, and has made prototyping products. From the middle to late fourth quarter to the beginning of next year, related products will begin to be shipped in batches until the beginning of next year. In addition, the company also includes customers such as Hammer, TCL, Meitu, and OnePlus. Hammer Technology released the new M1/M1L mobile phone in October. The stainless steel metal frame comes from the exclusive supply of Syinko Electronics. Through years of technology accumulation, Xingke Electronics has gradually developed mass production capacity in terms of stainless steel chassis. Xiaomi's next flagship model will use stainless steel-related technology, and Xingke Electronics has become a core supplier. Furthermore, we reaffirm our belief that Apple's new iPhone 8 next year will most likely use a “double-sided glass+stainless steel frame” body design. The stainless steel middle frame will even have a more complicated curved surface processing process. Overall, it will greatly raise the current metal case technology threshold and ASP level, and Xingke Electronics is expected to benefit. Although from the end of the third quarter to the beginning of the fourth quarter, on the one hand, it was affected by the slowdown in LeTV orders, and on the other hand, the R&D costs associated with importing a large number of new customers at the same time put some pressure on the company's short-term performance, but it was possible to shift from relying more on orders from a small number of customers to a structure of multiple customers. This effort was worth seeing for the company's long-term performance growth. The company began developing new customers a quarter ago. Currently, the largest customer's share of the company's orders does not exceed 60%, the proportion of accounts receivable is small, and the financial situation is healthy. However, with the gradual implementation of various products in the fourth quarter, there is a possibility that the company's profit will rise sharply month-on-month in the first quarter of next year. Furthermore, companies that the market is very concerned about issuing shares and paying cash to buy assets and raise supporting capital and related transactions, that is, mergers and acquisitions of Xinko Electronics, the company is expected to receive official approval from the Securities Regulatory Commission from the end of November to the beginning of December. The completion of the merger and acquisition of Xingke Electronics will have a positive effect on the overall positive development of the company's future business. In the fourth quarter, since Xingke Electronics obtained the qualification of a high-tech enterprise and received partial tax credit support, we determined that the annual net profit of Xinko Electronics was 35-3.7 billion yuan. Assuming that according to market expectations, the annual net profit of the traditional Jubilee business segment was 70-80 million yuan. After the merger, Jubilee Technology's annual exam preparation profit is expected to reach the level of 42-450 million yuan. Considering that there will be plenty of orders from Xingke Electronics' major customers in the first quarter of next year, the company will break out of the trough. We expect that under more optimistic conditions, Xingke Electronics' profit for the first quarter of next year will reach 120-150 million yuan, and the annual profit is expected to reach 556 million yuan. The current stock price of Jubilee Technology is less than 25 times the PE price after considering additional dilution, according to our estimated profit for preparing for this year's exam. The bottom of the valuation highlights a good buying opportunity, and we maintain our “buy” rating. Risks suggest that prices are falling too fast due to vicious competition in the CNC industry chain, and orders from major customers fluctuate. The investment recommendation is to reflect the value of the stock more realistically. The valuation model is calculated based on the share capital after the increase, and the EPS calculation is based on the profit estimate for the completion of the supplementary examination. We forecast EPS for 2016-2018 to be 0.901, 1.514, and 2.153 yuan, respectively, and corresponding PE is 23X, 14X, and 9X. Compared with the company's valuation and growth, similar companies still have long-term investment value and maintain a “buy” rating.