Event: The company announced its 2016 quarterly report, which achieved revenue of 338 million yuan (+45.8%), net profit of 14.4 million yuan (+1230%), net profit of 14.4 million yuan (+1230%), net profit of 14.04 million yuan (+2568%), and eps 0.03. The performance was in line with expectations. Key investment points: The quarterly high growth report is in line with expectations, verifying the inflection point judgment of the annual report. High growth can be expected throughout the year. The company's quarterly revenue and net profit growth rates have all achieved high growth. The growth rate of 46% of revenue is higher than the growth rate of the same period in the past 8 years. At the same time, the growth rate of net profit and non-net profit was 1000% +. The sharp rise in volume and price made it difficult to prove the inflection point of previous performance. We expect high growth throughout 2016, driven by the volume of battery backboard+lithium battery separator wire and coating line. Profitability increased rapidly, and expense ratios remained stable. The company's comprehensive gross margin for the first quarter report was 17.93%, +2.07pct year on year; while the sales expense ratio, management expense ratio, and financial expense ratio were 6.18%, 6.92%, and -0.43%, respectively, +0.17pct, -0.06pct, and -0.40pct, the overall cost ratio declined steadily; the net profit rate in 2015 was 4.58%, up 3.63pct from the same period last year, a significant increase. High-performance wet lithium battery separators and high-value-added coating films are expected to be gradually released in 2016. The popularity of the new energy industry chain drives the lithium battery diaphragm industry to continue to grow at a high rate (domestic lithium battery insulation production increased by 50% in 2015), and the rising share of ternary power batteries is driving demand for wet film forming processes. Relying on years of accumulating core technologies such as film formation, coating, and particles in the color film and photo paper industry, the company plans to invest an additional 300 million yuan to build a high-performance wet lithium battery separator line with a production capacity of 40 million square meters, and invest 130 million yuan to build 15 million square meters of ceramic coating modified diaphragms and 2 million square meters of special heat-resistant coating modified diaphragms. All production capacity is expected to achieve an average annual profit of 3.54 million before tax. Currently, the high-performance lithium-ion battery separator project located in Aerospace Lekai New Materials Industrial Park is progressing smoothly. It is expected that the lithium battery diaphragm business will increase in volume and contribute to performance in 2016. Aerospace Group's smallest market capitalization listing platform is expected to benefit from an increase in the group's securitization rate. Aerospace Group proposed a sharp increase in the asset securitization rate from 15% to 45% during the “13th Five-Year Plan” period. As the Group's smallest listing platform (6.1 billion), we expect the company to become the Group's capital operation platform for new materials and new energy. It is expected that the Group's hundreds of millions of profits, new materials, and new energy assets (solar, wind power, etc.) will be injected, so there is plenty of room for imagination and market value flexibility. The stock price is inverted to increase the price by 17%. The ban on one-year fixed increases will be lifted on May 23. Profit forecast and investment advice: We are optimistic that the gradual expansion of solar cell backplates+wet lithium battery separators and coating films will drive the company's high growth in the future. At the same time, we are optimistic that the company, as the smallest listing platform for Aerospace Group, will benefit from the increase in the group's securitization rate. The 2016-18 EPS is expected to be 0.15/0.23/0.36, corresponding to PE113/71/46X, maintaining the “increase in holdings” rating. Risk warning: The lithium battery diaphragm project fell short of expectations; capital operation fell short of expectations.