Incident: The company announced its three-quarter report that the first three quarters achieved operating income of 2,426 billion yuan, a year-on-year decrease of 10.34%, and realized net profit attributable to shareholders of listed companies of 176 million yuan, a year-on-year decrease of 6.26%. At the same time, it was announced that net profit attributable to shareholders of listed companies for the whole year was 198 million yuan to 258 million yuan, an increase of 0-30% over the previous year. Key investment points: Affected by intense competition in the domestic boiler market, revenue and profit declined slightly in the first three quarters. We look forward to the growth of overseas boiler general contracting and major environmental protection businesses. The operating income for the first three quarters mainly came from the total boiler and ancillary business of the boiler project, the environmental protection business, and the investment income of some participating agricultural and commercial banks. Under the combined influence of increased supply and falling demand in the domestic boiler market, industry competition was intense, and revenue and profits were affected. Since the overseas general contracting business is still in the early stages of planning, design, discussion and verification, and has not yet executed orders in the first three quarters, it has not made a continuous contribution to performance. At present, the company's total overseas boiler contract business order volume is 9.13 billion yuan. The region where it is located is in line with the national Belt and Road policy and direction. Demand for electricity is very strong, and subsequent implementation is worth looking forward to. As the order is executed, it will have a positive impact on the business performance in 17-18, so you can actively monitor the progress of each subsequent project. Environmental protection business currently mainly focuses on waste incineration power generation business and PPP project investment and construction. West China has won the bid for four waste-to-energy projects in Zigong, Guang'an, Shehong and Yulin, with a total investment of 1.55 billion yuan. Among them, the Zigong project has been put into trial operation and grid-connected power generation, the Guang'an project is under construction, and the Shehong and Yulin projects are in the early stages of construction; the first phase of the Zigong East New Town Ecological Demonstration Zone PPP project has a total investment of 2316.23 million yuan. Currently, the contract project is being implemented, and we expect the company to continue its environmental protection business in the future. Power up. Investment income of 70.79 million yuan was achieved in the first three quarters, a significant increase over last year, mainly due to increased earnings from commercial banks in Zigong City. The company recently invested 1.35 billion yuan to acquire 15% of Hengli Shengtai's shares to enter the graphene field. Later, mass production of graphene will greatly increase the company's investment income and contribute to increased performance. In the future, the company will gradually form a diversified development pattern of boiler equipment manufacturing, environmental protection, big finance, and new graphene materials, continuously creating new profit growth points. Judging from the cost situation, the management fee rate and financial expense ratio have increased slightly, while the sales expenses rate has declined. The sales expense ratio for the first three quarters was 1.33%, down 0.34 percentage points from the previous year. The management expense ratio was 7.34%, up 1.25 percentage points from the previous year, and the financial expenses rate reached 3.28%, up 1.21 percentage points from the previous year. The increase in financial expenses was mainly due to interest expenses on medium-term notes. The overall fee rate has not changed much, which indicates that the company has strong control over expenses. Continue to maintain a highly recommended rating. We adjusted the EPS for 16, 17, and 18 (including Hengli Shengtai's investment income) to 0.32 yuan, 0.55 yuan, and 0.8 yuan, respectively. We believe that the company's strategic layout is gradually being clarified, and the business pattern of boiler equipment manufacturing+big environmental protection+big finance+graphene new materials is gradually being formed. It is still an investment target worth continuing to track, and we continue to maintain our “highly recommended” rating. Risk warning: The risk that the project progress will not meet expectations, and the risk that the order volume will not meet expectations.