Dongfeng Yueda Kia's third plant was completed and put into operation, with a total production capacity of 800,000 vehicles. According to media reports, Dongfeng Yueda Kia's third plant in Yancheng was officially completed and put into operation on January 16; the plant has four major international advanced stamping, welding, painting and assembly processes. The initial design capacity of operation was 200,000 vehicles, and expanded to 300,000 vehicles in 2015. Since then, it can be further expanded to 400,000 vehicles according to market conditions; with the completion and commissioning of the three plants, Dongfeng Yueda Kia already has a production capacity of 800,000 passenger cars. Production was later increased to 1 million units. Seven new models will be put into production in the next four years. With the three factories being put into operation, the company announced that it will successively start production of seven new models in the next four years, mainly including 1) the B-class K4, which will be put into production in 2014; 2) the production of small SUVs and the joint venture self-owned brand Huaqi in 2015; and 4) the C-class K7 and a small sedan will be put into production in 2017. The new car launch plan mentioned above is basically in line with the five-year plan announced by the company at the beginning of the year. 2014 may be a low point in the company's sales and profit growth rate, considering: 1) only one new model (K4) was launched in 2014, and 2) after the new factory was put into operation, there will be a lot of initial new depreciation and expenses. We think 2014 will be a low point in the company's sales and profit growth rate. We expect Dongfeng Yueda Kia's sales volume to reach 600,000 units this year, up 9.8% year on year, and Yueda's investment profit will increase 4% year on year. Valuation: Maintaining a “neutral” rating. The target price is 11 yuan. Our 2014 EPS forecast is 5% lower than the market's consensus forecast. Considering that the company's profit growth rate in 2014 may remain low, we maintain a “neutral” rating for the company. The derivation of our target price is based on the UBS VCAM discounted cash flow model (WACC is 10.6%), which corresponds to the company's 2014E PE, about 7x.