Key investment points: The company achieved a good start in 2017 Q1, and achieved high growth in revenue and net profit. The company's revenue and net profit in 2016 were 1,024 million/101 million yuan, up 9.75%/101.13% year on year; in Q1 2017, the company's revenue and net profit were 337 million/35 million yuan respectively, up 34.62%/213.62% year on year. The crankshaft is the company's largest product, and the gross margin is relatively stable. In 2009-2016, the company's internal revenue ratio for crankshafts remained around 60%, and the clutch ratio remained at 30%. The gross margin of crankshafts declined in 2013-2015 and was relatively stable in 2016; the gross margin of clutches maintained a steady, moderate upward trend. The product structure and customer structure have been steadily improved. (1) According to the company's annual report, since 2015, the company's crankshaft industry has implemented a “bigger and smaller” strategy. Sales of passenger car crankshaft products in 2016 increased by 40.24% compared to the same period last year, far higher than the average increase in revenue. The company's passenger car crankshafts began to develop at an accelerated pace in 2015, and the passenger car crankshaft production line is already at full capacity. (2) Major breakthroughs have been made in the development of international high-end customers. According to the company's annual report, the company passed the Volvo and Mercedes-Benz supplier qualification audits and obtained the development qualification for new crankshaft blank products in 2016, marking that the company has been recognized by top international automobile manufacturers in terms of comprehensive management of technology, quality, production, and finance. Profit forecasts and investment advice. We expect the company's revenue in 2017-2019 to be 1,295/14.81/1,695 million yuan, EPS of 0.22/0.26/0.32 yuan, corresponding to the closing price of PE on June 23, 2017, 49/41/33 times, respectively. Compared with comparable companies, the company's valuation is too high, coverage for the first time, and no ratings yet. Risk warning. The growth rate of the passenger car market is lower than expected; the growth rate of major customers is lower than expected; and the price of raw materials is rising.