Summary of the report: Relying on its rhenium resource advantages, the company transformed the supplier of advanced aero engine blades, engines and the entire drone industry chain. Demand for molybdenum, the company's main business, is sluggish, and the transformation extends to the entire industry chain of rhenium elements - high temperature alloy base materials - single crystal blade castings - aero engines/gas turbines - drones. Rhenium-containing monocrystalline blades fill the domestic gap and reduce the generation gap with foreign countries. At present, the production and sale of third-generation and fourth-generation monocrystalline alloy blades has not been achieved in China, yet the company has successfully developed 2 types of high-temperature alloy base materials (without rhenium: CAST407; with rhenium: CAST-SC4) and a number of monocrystalline turbine blades for aviation and gas turbines, and the performance has reached the level of fourth-generation monocrystalline blades. Advance into the broad market of “two engines” (aero engines, gas turbines) of 100 billion dollars. One of the core and main difficulties of aero engines and gas turbines is high temperature alloy turbine blades. The corresponding market space is the import substitution space of the military aero engine blade market of 107.3 billion, the marine gas turbine blade market of 18.4 billion, and the gas turbine blade market for civil power generation of 30.9 billion, respectively. The industrial chain was extended - the layout of the small-scale aviation and drone markets. The 1000KG and 750KG thrust engines developed by the company are small to medium turbofan engines, making up for the gap in the market between medium and medium channel performance engines. The rapid development of the logistics sector and the shortage of pilots have spawned the demand for cargo drones. Company profit forecasts and investment ratings. Blades are one of the most critical components of aero engines, and are also the main reason limiting the localization of aero engines in China. Currently, the global market size of high temperature alloy blades is at the level of 100 billion, and domestic manufacturers are facing bottlenecks on issues such as turbine-grade blade yield and high-temperature creep. The company's successful development of fourth-generation monocrystalline blades has filled the domestic gap and effectively shortened the gap with foreign generations. After passing third-party system certification and customer certification in the future, the company's performance will accelerate with the release of order volume. We expect the company's operating income for 2016-2018 to be 168 million yuan, 832 million yuan and 1,072 million yuan respectively; earnings per share are 0.05 yuan 0.27 yuan and 0.43 yuan respectively, corresponding to PE 560X, 97X and 56X respectively; we gave the company a target price of 34.1 yuan for 6 months, covering the first time, and giving the company a “highly recommended” rating.