The acquisition of Huayu Garden opens up new space for growth, and performance is expected to accelerate after additional capital is available: The company's acquisition of Huayu Garden at the end of 2014 is a first-class municipal garden enterprise in southwest China. It has qualifications in landscape construction, planning and design, landscaping management, water pollution control, solid waste treatment, etc., and the ecological restoration business accounts for about 60%, and its 10 branches and 5 subsidiaries cover the whole country. In mid-2016, the garden business accounted for 64.41% of revenue, and the gross margin reached 24.93%, far exceeding the gross profit of the traditional bottle cap business of 15.97%, and the performance support was even stronger. The company announced a 22.09% year-on-year increase in revenue and 11.36% year-on-year increase in net profit for 2016. It is expected that garden construction progress will accelerate after additional funding is received, and results are expected to be confirmed at an accelerated pace. There are plenty of on-hand orders, and PPP is driving high performance growth. The PPP project will improve the company's operating cash flow during the construction phase, and at the same time, investment cash flow expenses will increase. When high leverage and low proportion of capital investment are invested, construction income covers investment and improve overall cash flow. Huayu Garden has increased innovation in the PPP model. Since last year, it has announced the signing of a total of 1,337 million PPP orders, which is 174% of the company's garden revenue in 2015 and has become an important guarantee for performance growth. Bottle cap and garden two-wheel drive. The company has now formed a dual business pattern of packaging business and garden business. It is the largest anti-counterfeiting bottle cap manufacturer in China, serving more than 700 customers, and producing 2 billion caps a year. As the liquor industry enters a period of adjustment, the company has carried out supply-side reforms, actively explores QR code anti-counterfeiting services for bottle caps, and provides customers with value-added services such as anti-counterfeiting, product traceability, and anti-smuggling through the “bottle cap+QR code” method. At the same time, it also uses Internet ports to give full play to the advantages of existing customer channel resources. In mid-2016, the revenue of the anti-counterfeiting bottle cap business was 219 million yuan, a year-on-year decrease of 2.55%, and the traditional bottle cap business was basically stable. The non-public release was approved, and the follow-up momentum is strong. The company's fixed growth plan for 2016 has been approved and plans to raise 781 million dollars in capital. Among them, 620 million yuan was injected into the Jinqiao Lake urban infrastructure and ecological restoration construction PPP project in Bazhou District and the ecological restoration and comprehensive management PPP project in Xixiu District of Anshun City. Sufficient capital will speed up project implementation, bring considerable benefits to the company, and provide experience for subsequent project implementation; 60 million for the bottle cap QR code technology upgrade project. The promotion of innovative bottle cap business will help supplement the original bottle cap business with “Internet” and “Internet of Things” technology to increase the added value of the product; 110 million will be used to repay bank loans, reduce the burden of financial expenses, and promote the company's profit Capacity strengthening. Innovation in traditional business, accelerated PPP orders, reduced financial expenses, and the company's strong follow-up momentum ensures worry-free performance growth. Investment advice: We expect the company's EPS from 2016 to 2018 to be 0.21/0.29/0.36 yuan respectively (after additional dilution), giving a target price of 8.7 yuan and a buy-A rating. Risk warning: macroeconomic downside risk, receivables bad debt risk.