Main points of investment:

Conclusion b: under the background that the performance of construction machinery is difficult to improve, benefiting from the underground space construction and subway construction in Xiamen, the marginal income of listed companies will be greatly improved and promote profit growth. It is estimated that the EPS in 2015-17 will be-0.67,0.10 and 0.17 yuan respectively, and the net asset per share in 2016 will be 3.28 yuan. Taking into account that after the completion of AVIC Holdings, the military background promoted the valuation of the company, giving the company 2.5 times PB, corresponding to the target price of 8.2 yuan, the first coverage to give an overweight rating.

Underground space helps Xiamen to improve its performance. ① 's traditional construction machinery industry is unlikely to grow, and the industry's production capacity will continue to be cleared. In the face of the predicament of the industry, ② has set up two joint ventures, shield machine and construction, to actively participate in the urban underground space construction project in Xiamen. The shield machine customized for Xiamen Metro has been greatly affirmed, and the follow-up order is carefree. It is expected that in the future, starting from Xiamen, it will gradually radiate Fujian and promote it overseas, or it will pry the profit growth of listed companies. In the aspect of ③ underground space construction, taking the urban underground pipe corridor construction as an example, there are many planning projects and huge market space at present. Xiamen work is a key manufacturing enterprise supported by Xiamen SASAC, and it is expected to gain growth momentum in the process of construction.

Join hands with AVIC and civil-military integration to open a new era of intelligent machinery. The actual controller of ① Xiamen will be changed to AVIC. With the professional asset integration and restructuring, it is expected that the valuation of Xiamen will be further improved. The XGJE intelligent control system jointly developed by ② Xiamen and AVIC integrates AVIC's aviation military technology, takes the first step in the layout of the company's high-end equipment, and will open a new era of intelligent machinery in the future.

Catalyst: accelerating the Construction of Underground Space in Xiamen

Core risk: the risk of decline in fixed asset investment, and the expansion of new products is lower than expected.