Key investment points The company's urea gas source is guaranteed, and the profit of urea in 2014 may be better than in 2013. Supported by a series of favorable factors such as low inventories, low tariff policies, and rising domestic and foreign gas prices, China's urea spring farming market price in 2014 is expected to bottom out and rise, and the average urea price in 2014 is expected to be better than in 2013. As a relative holding subsidiary of Sinopec's Chengdu Huachuan Oil and Gas Development Corporation, the company's gas supply is stable and guaranteed, and the company's urea profit in 2014 is expected to be better than in 2013. The implementation of national four emissions for diesel vehicles is beneficial to the company's promotion of automotive urea. According to research, orders for diesel vehicle exhaust treatment systems issued by OEMs surged in the last two months of 2013, and the market started rapidly. The orders received by exhaust treatment system suppliers in the last two months of the year were even far higher than the production and sales volume in the first 10 months of 2013. With the full implementation of national IV emission standards for diesel vehicles, the automotive urea market demand will experience explosive growth. Domestic sales of the company's automotive urea will experience explosive growth from 2014 to 2016. Considering that the profit level of automotive urea is higher than that of ordinary urea, the overall gross margin level of the company's urea will increase in the future. The Mianyang base project was put into operation in 2014, and the profit of nitro compound fertilizer is worth looking forward to. Mianyang Meifeng Chemical Park is expected to start production of 450,000 tons of nitro compound fertilizer in the 2nd quarter of 2014. The company's nitro compound fertilizer has the advantage of self-sufficiency in raw materials. Relying on the compound fertilizer marketing network formed in the southwest region, there is little problem with absorbing 450,000 tons of production capacity. According to the market price of 2,300 to 2,500 yuan/ton of nitro compound fertilizer per ton, we expect the gross margin of the company's nitro compound fertilizer to exceed 15%, and the profit prospects are promising. The company's LNG business entered a harvest period in 2015 and 2016. The company's holding subsidiary Shuangrui Energy Company and the Langzhong and Bazhong Municipal Government each plan a joint venture LNG subsidiary with a daily processing capacity of 1 million cubic meters of LNG. The Langzhong and Bazhong LNG projects are expected to be put into operation in mid-2015 and mid-2016, respectively. Assuming that the net profit of the joint venture is 0.5 yuan per cubic meter of LNG, the annual net profit of the Langzhong and Bazhong projects is expected to be around 180 million yuan. Profit forecast and investment rating: The average price of urea in 2014 is expected to be better than in 2013, the company's urea business profits will recover, automotive urea sales volume is expected to experience explosive growth from 2014 to 2016, the LNG business will also enter a harvest period in 2015 and 2016, and the company's performance growth from 2014 to 2016 is more certain. Considering that the progress of the company's Mianyang base project is lower than expected and the domestic automotive urea demand release date has been delayed, we lowered the company's profit forecast and lowered the company's 2013-2015 EPS from 0.54 yuan, 0.77 yuan, and 0.96 yuan from the previous 0.54 yuan, 0.54 yuan, and 0.88 yuan. The current stock price corresponding to 2013-2015 dynamic PE is about 21.5, 16.6, and 10.1 times, respectively. Considering that the company is actively transforming into the automotive urea and LNG business, the current valuation level is compared to chemicals The valuation advantages of environmental and LNG themed companies in the industry are obvious, maintaining the company's “recommended” investment rating. Risk warning: The promotion progress of automotive urea is lower than the expected risk, and the progress of the LNG project is lower than the expected risk.