Incident: Recently, we visited Dongfang Tantalum and had exchanges with some of the company's management personnel. Dongfang Tantalum (000962) is China's largest professional tantalum-niobium R&D and production base. The controlling shareholder of the company is China Color (Ningxia) Oriental Group Co., Ltd., and the actual controller is the central enterprise China Nonferrous Mining Group Co., Ltd. There have been recent changes in the management of the company. Judging from the resumes of the chairman and general manager designate, they are all internal managers who have gone through continuous training and grown step by step within the controlling shareholder. We have determined that the new management will work to get the company out of trouble. The traditional leading products of Dongfang Tantalum Industry (000962) are tantalum-niobium products. In the past two years, the company has made some business expansion, extending to the fields of titanium metal, alloy products, photovoltaic materials, etc. Judging from the distribution of revenue, tantalum-niobium products still occupy a dominant position in the company's revenue and have contributed a certain amount of profit; in terms of new industries, although the revenue contribution has increased, overall losses, especially in the titanium sector, have caused the company's overall performance to drop sharply; at the same time, the company has maintained a certain trade volume in order to make up for the overall decline in revenue. The previous fund-raising project had not progressed well. Since 2011, the company has enriched the categories of tantalum-niobium core business through allotment of shares: 1) a demonstration project for high-tech industrialization of targets for extremely large-scale integrated circuits, and has built a tantalum metal series target production line with an annual output of 80 tons, which mainly takes into account the processing of titanium and copper targets; 2) a high-tech industrialization demonstration project for niobium and niobium-based materials, a high-purity superconducting niobium production line with an annual output of 10 tons, as well as 60 tons of chemical anticorrosive niobium-based alloy tubes (30 tons/year) and electric light source niobium alloy tubes (30 tons/year)) Production line; 3) A demonstration project for the high-tech industrialization of niobium monoxide is to build a new niobium monoxide (NbO) production line with an annual output of 60 tons on the basis of the existing pilot production line. The target material and niobium base material projects have now been put into operation, while the niobium monoxide project is not progressing well due to market changes; 4) The company's original fund-raising project planned to build a 3,000-ton production line, but later part of the production capacity investment was cancelled due to technical problems, and now the production capacity is about 2,500 tons. Competition in the entire civilian titanium market has been fierce in recent years, while the entry threshold for the military market is high and sales are limited. At the same time, the company's titanium processing materials product structure is unreasonable, which is a drag on performance. Valuation and ratings: Considering that the company's traditional leading products and new products are still facing certain difficulties, we expect the company's 2015-2017 EPS to be -0.24 yuan, -0.21 yuan, and -0.18 yuan, respectively. However, the quality of the company is relatively good, and the new management has stepped up reform efforts and temporarily given the company an “increase in holdings” rating. Risk warning: Product markets continue to deteriorate, reform, or fall short of expectations.