The main investment points promise not to reduce holdings, demonstrating the confidence of actual controllers. On October 25, the company's controlling shareholders, actual controllers, and their co-actors decided to terminate the share holdings reduction plan announced on September 3 and promised not to reduce their holdings of the company within 12 months. This move shows their confidence in the company's future development and optimism about the future development of the company. The main telecommunications industry is developing well, and it can be expected to maintain a compound annual growth rate of 20-30% in the future. Judging from the development situation of the communications industry, the comprehensive coverage of 4G networks and the mature promotion of 5G networks will be the focus of China's development for some time to come. As a manufacturer of supporting facilities for communication equipment, the company actively cooperates with companies such as Nokia, Huawei, Alcatel-Lucent, and Ericsson to produce products such as precision aluminum alloy components, radios, and filters, and the market response is good. It is expected that the company's market share will remain stable in the future, and it is hoped that it will take advantage of the expansion of market size driven by the development of the communications industry to achieve rapid growth in performance. Technological breakthroughs have boosted the rapid expansion of the consumer electronics business. On July 14, the company achieved a breakthrough in anodizing processing technology through the acquisition of Zehong Technology. The new process can effectively reduce costs and reduce production time on the basis of improving product performance. Taking advantage of technology, the company is expected to expand its market share of tablet cases and phone cases, and related business may become a new highlight of the company's performance. At the same time, the company plans to increase its holdings of Kaimao Technology, enter 2.5D and 3D glass manufacturing, improve the business structure in the consumer electronics sector, and further enhance market competitiveness. Relying on epitaxial development, the company entered the military industry. By holding Beijing Chiyilong and Xi'an Xinghang, the company obtained relevant qualifications, developed the military transmission market, and participated in military and civil aircraft parts competition. Beijing Chiyilong promised performance of 50, 75, and 10 million yuan respectively in 2016-2018; Xi'an Xinghang participated in the supply of parts for models such as the Trans-20 and C919. The military and civilian integration strategy is the focus of the future development of the national defense industry. The company is expected to rely on its technical experience and advantages in civilian precision aluminum alloy components to achieve rapid growth in military parts business across borders. The fixed increase application was approved, and traditional businesses and new energy vehicles are expected to become the focus of the strategic layout. On September 1, the company's non-public offering application was reviewed and approved by the Securities Regulatory Commission, and the third revised draft was approved by the board of directors on September 7. It is proposed to raise about 1.1 billion yuan to increase production of mobile communication radio frequency equipment and precision structural parts for intelligent interconnection equipment and supplementary working capital. If the plan progresses smoothly, the company's traditional business scale will be further expanded, and profitability will be further enhanced. The company has excellent strength in the field of new energy vehicles, and has obtained supplier qualifications from Tesla and received orders. Considering the good development situation of traditional business and new energy vehicles in the future, it is expected that the company will still be able to expand these two fields through endogenesis and extension. risk factors. The yield of aluminum die-cast phone cases falls short of expectations, progress in military business development falls short of expectations, merger and acquisition integration falls short of expectations, etc. Earnings forecasts, valuations and investment ratings. Considering the intense competition in the telecommunications market and the uncertainty of corporate mergers and acquisitions, we maintain the 2016/17/18 fully diluted EPS forecast of 0.34/0.53/0.64 yuan. The current price is 10.69 yuan, which is 31/20/17 times PE corresponding to 2016/17/18, respectively. Considering the company's market position in the field of communication structures, expansion in the field of consumer electronics and military industry, and layout in the field of automotive lightweighting, maintain the company's “buy” rating, with a target price of 15 yuan.