Incident: The company issued an announcement stating that Xi'an Aohua Electronic Instrument Co., Ltd., a holding subsidiary, received the “Letter on Approval to the Listing of Xi'an Aohua Electronic Instrument Co., Ltd.'s shares on the national SME share transfer system” from the National SME Share Transfer System. It was agreed that Xi'an Aohua shares will be listed on the national SME share transfer system. Currently, Xi'an Aohua is going through the listing procedures in accordance with relevant regulations. Key investment points: The company's ABC plan came to a successful conclusion. The company currently holds 21.7 million shares of Xi'an Aohua, accounting for 43% of its total share capital. Langfang Xinsaipu, a wholly-owned subsidiary, holds 4.25 million shares, and the company holds a total of 52% of the shares. An ABC plan has been formulated to cultivate the independent listing of each business sector and form a multi-platform financing and multi-level capital market pattern. During the 2015 reporting period, Zhongying Anxin, the company's third-level holding subsidiary, and OMEC were successfully listed on the National SME Stock Transfer System (New Third Board). The listing of Aohua Xi'an marks the successful conclusion of the company's ABC plan. The interim report performance has declined, and the most difficult time for the industry is over. The company's performance forecast for the first half of the year was to achieve a profit of 1297 to 23.34 million yuan, a year-on-year decrease of 55% to 75%. The main reason is that oil and gas companies, which are downstream customers of the company, are affected by low oil prices, and the reduction in oil and gas investment has led to a decline in the company's business volume and profit margin. We expect the machinery manufacturing sector to be hit the hardest by low oil prices; it has had a negative impact on the company's overall performance. However, based on the fundamentals of the industry, although the overall prosperity of the industry is still under great pressure, it is probable that the low oil price of $26 in the first quarter will no longer occur. As the fundamentals of the industry gradually pick up, subsequent oil and gas investment is expected to gradually increase. Further extend the oil and gas industry chain. The company strives to expand and strengthen the G&G business, engineering business, and machinery manufacturing business segments; actively lays out and extends the industrial chain. The company China and Overseas Energy Co., Ltd. signed a strategic framework cooperation agreement to build a comprehensive trade platform using resources from both parties. Initially, the two sides will mainly trade petroleum-related products and other chemical products, and will focus on domestic trade. In the future, the variety of trade will be broadened and extended to international trade. At the same time, the company has further increased capital in cloud technology companies and introduced VR technology into the field of oil and gas energy exploration, which is expected to further improve service quality in the future. Give it a “Highly Recommended” rating. The estimated EPS for 16-18 is 0.25/0.34/0.37 yuan, respectively, and the corresponding PE is 41.81/30.39/27.76 times. The company was given a target price of 13.60 yuan corresponding to 40 times PE in 2017, giving it a highly recommended rating. Risk warning: risk of further decline in international oil prices; risk of oil companies' investment in overseas projects being delayed; risk of oil field EPC overseas business expansion falling short of expectations; risk of EPC orders for gas pipeline construction exceeding expectations.