Key investment points 1. Another 5.3 billion pipe gallery PPP project marks the company's transformation into a municipal service outsourcer. The consortium formed by Senyuan Co., Ltd. and Jilin Municipal Construction Group Co., Ltd. once again won the pre-bid for the Jilin Underground Integrated Pipeline Government and Social Capital Cooperation (PPP) project [Jilin High-tech Zone Underground Integrated Pipeline Construction Project Section 3]. The final price of the project is 5.33 billion yuan. The project period: N+25 years (N years: construction period; 25 years: operation period), the construction period N years is tentatively 2 years. After winning the 4.4 billion PPP order for the Jilin Pipe Gallery in September, the company won another 5.3 billion bid, highlighting the company's success in transforming into a service outsourcer and officially entering the trillion municipal service outsourcing market. The 10 billion pipe gallery PPP project is expected to bring the company more than 100 million in annual profit contributions and push the company's performance into a period of explosion! 2. With the response to equipment tenders and the implementation of PPP projects, Q4 will be a turning point in the company's performance. Senyuan is a leading road maintenance equipment company. Starting in '13, the road maintenance equipment leader established joint ventures in the PPP model. Currently, 19 joint ventures are spread all over the country and will enter the harvest period at the end of the year. It is expected that the net profit of individual mature companies will exceed 10 million. Currently, Senyuan shares an average of 30% to 40% in joint ventures, and is expected to control high-quality companies in the future. With the response to equipment tenders and the implementation of PPP projects, the layout of the first two years entered the harvest period at the end of '16. Q4 will be a turning point in the company's performance, and the company ushered in a period of rapid transformation and development! 3. The company and Enlightenment Sound will open a new chapter in the cooperation model, which will bring rapid development to equipment sales. Sander is a leading domestic solid waste treatment engineering system integration enterprise. It also lays out intelligent integrated sanitation services on the Internet, and uses this as an entry point to lay out renewable resource recycling, advertising, reverse logistics and other businesses, making every effort to create an Internet+ model sanitation operation. The company obtained 32 new sanitation and transportation project contracts in 2015, and it is expected that 230 new basic sanitation operation project companies will be established nationwide from 2016 to 2018. After cooperating with Senyuan, it is expected that road maintenance will be incorporated into the company's platform project to enhance the scope of the platform's business. Senyuan's rich road maintenance layout and Sander's Internet platform will help both parties quickly occupy the 100 billion market for maintenance services. 4. Senyuan is also deploying military industrial+3D printing, which is expected to contribute to new performance growth points Senyuan Co., Ltd. has become a military level supplier in terms of new highway maintenance machinery. The company's products such as large-scale heat regeneration units, road surface snow removal and cleaning equipment are included in military procurement and can join the military's supply system. The company will also use sand laser 3D printing technology to participate in the rapid manufacture of parts such as ship propellers. Exploring the military market is another new growth point for the company's business performance. Senyuan began laying out the 3D printing industry chain in '14. Currently, the company is applying for military secrecy qualifications. The company's 3D printing supports key naval projects, and has great potential, and is expected to become the next Wang Huaming team (J-20 support). 5. The profit forecast predicts the company's 16-18 performance of 110 million yuan, 220 million yuan, and 300 million yuan, EPS of 0.4, 0.8, 1.1, PE corresponding to 54X, 27X, and 20X, maintaining a highly recommended rating. 6. Risks suggest that the number of joint ventures established falls short of expectations, and PPP projects are not progressing as expected