1. Analysis and judgment The Provincial State-owned Assets Administration Commission holds Feida Environmental Protection through Juhua Group, and the transformation of a comprehensive environmental protection platform into a comprehensive environmental protection platform disclosed according to the additional issuance plan that Feida Environmental Protection will target 63.6 million shares to Juhua Group, a subsidiary of the Zhejiang State Assets Administration Commission. After the additional distribution is completed, Juhua Group will become a shareholder of Feida Environmental Protection, and its environmental assets will be injected into Feida. At that time, Feida's environmental protection business will be upgraded from atmospheric management to full environmental protection industry coverage, achieving a leap from a leading dust collector to a comprehensive environmental protection platform enterprise. Feida's high-quality brand is perfectly combined with local government resources, and the transformation strategy achieves a win-win situation. Feida Environmental Protection is the first domestic enterprise engaged in the development and manufacture of dust collectors for large-scale thermal power plants, and its dust collector product market share has been among the highest for a long time. Juhua Group is an enterprise directly under the Zhejiang State-owned Assets Administration Commission. After Juhua enters the market, Feida Environmental's brand popularity in the environmental protection market is expected to be perfectly integrated with Zhejiang local government resources. Juhua Group's environmental protection assets cover various fields such as sludge incineration and disposal, dangerous/medical waste, domestic waste incineration, and industrial sewage, laying a good foundation for rapid expansion across industries after Feida took over. At the same time, after Juhua enters the company, it is expected that certain adjustments will be made to the company's original incentive mechanism, which is conducive to fully mobilizing the enthusiasm of employees, and profitability is expected to be further improved. Zhejiang Province has huge investment space for environmental protection. The advantages of provincial environmental protection platforms are extremely obvious. Zhejiang has a high degree of industrialization. Domestic sewage industries such as chemicals, printing and dyeing, papermaking, and electroplating are well developed, environmental capacity is decreasing, and there is huge room for environmental improvement and environmental protection investment. At the same time, the economy of Zhejiang Province is well developed, and the per capita GDP has broken through the 10,000 US dollar mark, reaching the international standard “middle developed country” level. Local budget revenue is also among the highest in the country, and the Zhejiang government has strong investment capacity for environmental management. At present, the 4th Plenary Session of the 13th Zhejiang Provincial Committee has officially put forward the slogan “Common Governance of the Five Waters” to launch the province's major strategy for managing the environment, promoting transformation, and benefiting people's livelihood. Specific goals include achieving basic coverage of urban sewage interception and storage, rural sewage treatment, and centralized treatment of urban domestic waste by 2017. Zhejiang Province is expected to usher in a peak period of environmental investment in the next 3-5 years, and Feida Environmental Protection, as the largest environmental protection enterprise in the province and also a provincial environmental protection platform, will occupy an extremely favorable position in terms of market development and project acquisition. Achieving rapid expansion through continuous mergers and acquisitions in the future will be a probable event. Dust collector sales continue to be booming, and orders continue to grow rapidly because new emission standards are about to be implemented. Currently, demand in the thermal power dust removal market is very strong. The company's domestic orders have maintained a high growth rate of about 50% year-on-year in recent years. The transformation of dust collectors is very difficult. Only a few large enterprises with solid technical strength have the ability to undertake projects. Currently, the company has begun to take the lead in implementing “ultra-clean emission” technology that emits 5 mg or less, and its market share is expected to increase further in the future. 2. Profit Forecast and Investment Suggestions We expect the company's net profit for 2013-2015 to be 41 million yuan, 71 million yuan, and 138 million yuan respectively; equivalent EPS is 0.20 yuan, 0.35 yuan, and 0.68 yuan respectively, corresponding to the current stock price of PE99, 56, and 29 times the current stock price. Although the relative valuation level is high, considering the good prospects of the company's business transformation and huge development space after Juhua's entry, the company was given a “careful recommendation” rating for the first time, with a reasonable valuation of 25 yuan. 3. Risk warning: The timing for issuing additional assets and disclosing them is uncertain, and management consolidates risks.