Core view: The overall growth rate of the petrochemical and coal chemical industry is slowing down, and there are still bright spots in some sub-industries. Since 13 years, the growth rate of fixed asset investment in the petrochemical industry has been declining year by year, the development of the coal chemical industry has been slow, and the overall investment in the industry has slowed. China's dependence on foreign oil is as high as 60%. By 2020, China will still have a national oil reserve base with nearly 1/2 of the planned strategic reserves to be built, and the market space is vast. Considering the importance that the country attaches to natural gas in adjusting the energy structure and the recent rebound in oil prices, it is expected that natural gas consumption will continue to grow steadily in the future. The company has excellent technology and naturally enjoys high-quality resources. The company whose main business has an advantage in competition is a restructured enterprise of the Ministry of Energy. It is rooted in the Sinopec system and has rich experience in survey and construction. He has excellent technical qualifications, is the chief editor of industry standards, and has a first-mover advantage in the field of underground oil depots. The company is an asset-light operation. In recent years, it has been hampered by the slump in the industry, and revenue has declined rapidly. After listing, the company's financing channels have been opened, and future performance is expected to improve. To target Sinochem Geotechnical, multi-sector expansion or more appropriate choices. Against the backdrop of declining industry growth, construction companies have changed their business ideas one after another and gained further expansion through transformation, mergers and acquisitions, etc. Take Sinochem Geotechnical as an example. Its background and main business are similar to the company. Since 2013, it has changed its thinking and expanded on a large scale through mergers and acquisitions, and has been recognized by the market. Recently, the company has begun to gradually explore the downstream design industry, high-speed rail, nuclear power and other related markets. The investment advice company is an industry leader in the field of geotechnical exploration and construction, a restructuring enterprise under the primary energy system, and has an absolute competitive advantage in the field of petrochemical exploration. However, investment in related fields has continued to decline in recent years, and the company's business has also been greatly impacted, and its performance is currently at a low point. The company is currently actively exploring various related fields, and hopes to use the capital market to integrate relevant resources after listing. We believe that the company's fundamentals are at a low point and are expected to reach an inflection point. The 2016-2018 EPS is expected to be 0.28, 0.33, and 0.40 yuan, giving the company a “buy” rating. Risk Alerts