Incident: Chuangli Group announced on October 21 that China Coal Machinery Group, the controlling shareholder of the company, plans to obtain 70.37% of Huizhou Yineng Electronics's shares through capital increases and equity acquisitions. Within 12 months of China Coal Machinery Group's acquisition of a controlling interest in Yineng Electronics, the company can integrate with Yineng Electronics in an appropriate manner. Yineng Electronics has a market share of more than 30% in the domestic power lithium battery BMS field. Based on concerns about the company's further expansion into the new energy sector, we recently investigated the company. Comment: It is very likely that 100 Yineng Electronics will inject China Coal Machinery Group, the controlling shareholder of the listed company, to obtain 70.37% of Huizhou Yineng Electronics's shares through capital increases and share acquisitions. The company can give priority to transferring all of the shares held by China Coal Group in Yineng Electronics. We believe that the acquisition of Yineng Electronics is in line with the company's and controlling shareholders' strategy to further deploy new energy. It is very likely that Yineng Electronics will soon inject into listed companies, and it will form a very strong synergy with the company's PACK business at that time. 2. The company's new energy map was further improved. In April, the company and Hefei Xingyao, China Aviation New Energy Technology Research Institute and other institutions jointly set up the Hefei Chuangda New Energy Project to enter the NEV PACK and motor electronic control fields. After the commencement of production, it is expected to achieve annual sales revenue of 1.53 billion yuan and annual net profit of 130 million yuan. At the same time, the company also increased capital in its subsidiary Chuangli Puyu to invest in supporting projects such as on-board chargers and charging piles for new energy vehicles. A new energy vehicle company was established in September to enter the field of new energy vehicle operation. Through continuous layout, the company's new energy layout has been further improved. In the future, the company's PACK business, electric motor control business, charger business, BMS, and new energy vehicle operations can form perfect collaboration. 3. The traditional coal machine business is gradually stabilizing. The company's main products, coal mining machines and tunneling machines, are all high-end coal machine equipment, and the gross margin has remained above 45%. Due to falling coal prices, performance has declined to a certain extent in recent years. However, with the advancement of supply-side reforms, coal prices have clearly rebounded since 2016. Coupled with the country's steady push for unmanned coal mining, we expect Chuangli's 2017 coal engine performance to gradually stabilize. 4. Performance forecasts and investment recommendations. Considering that the new energy business will contribute to revenue and profit in 2017, while the traditional coal machine business will also resume growth, we forecast that the net profit of listed companies in 2016-2018 will be 109 million yuan, 264 million yuan, and 322 million yuan respectively, and corresponding PE 74 times, 31 times, and 26 times, respectively. First coverage, careful recommendation given. 5. Risk suggests that asset injection is uncertain; the development of the NEV industry is falling short of expectations.