Matters On May 20, Hengtai Aipu (300157.CH/RMB 13.10, purchase) and China Overseas Energy Co., Ltd. signed a strategic framework agreement to build a comprehensive trade platform using the existing resources of the two parties to carry out all-round cooperation in energy. On the basis of the framework agreement, cooperation categories include, but are not limited to, petroleum-related products and chemical products trade. On the basis of the framework agreement, they will jointly explore new business development models, make full use of their own advantages, develop together, establish a strategic cooperative relationship, and achieve the goal of win-win cooperation. The two parties have agreed on a trade amount of 1.5 billion yuan per year, and the execution period of the contract is three years. Hengtai Aipu will authorize Hengtai Aipu (Shanghai) Enterprise Development Co., Ltd., a wholly-owned subsidiary, as the specific executor. For the specific trade cooperation business that actually occurs, the two parties will agree separately to sign a formal specific business contract. Main opinion 1. Hengtai Aipu and China Overseas Energy are based on trade and will expand the company's existing business areas and get involved in petroleum-related products and chemical products trade. In the future, the two sides will cooperate at a deeper and broader level. The two parties have agreed on a trade amount of 1.5 billion dollars per year, and the execution period of the contract is three years. 2. The company has completed the acquisition of Xinjinhua and Sichuan Oil Design. The equity transaction cost price is 13.54 yuan. Currently, the stock price is still below this cost line. The biggest difference between the market and Hengtai Aipu is the uncertainty of performance. However, last year was supposed to be the hardest year for the company. Faced with the double pressure of a shrinking domestic oil service market and stagnation in overseas oil field development, oil prices have rebounded to a reasonable range this year, and the company's layout since listing will enable the company to enter a steady development trend. 3. Focus on the development and application of the company's cloud computing and VR technologies. The company's original business was seismic data processing and interpretation. The foundation is also the advantage of computer storage and computation capabilities. The company has set up a cloud computing company, and the R&D results can also be applied to fields other than the petroleum industry. 4. The 2016 performance is expected to be around 250 million yuan. The current market capitalization of 9 billion yuan corresponds to a price-earnings ratio of 35-40 times. The impetus for rising stock prices will come from the continued rebound in oil prices, big orders, or breakthroughs in cloud computing. It continues to be highly recommended and maintained in the buying rating. Risk factors: International oil prices have reached a new low, but the probability of this is already very small; the systemic risk of A-shares has led to a decline in valuation.