Description of the incident: On December 31, the company and Zhuji Lujian Environmental Protection Equipment Co., Ltd. (hereinafter referred to as “Lujian Company”) signed the “Zhuji Chentong Environmental Engineering Co., Ltd. Equity Transfer Agreement” to acquire 100% of the shares of Zhuji Chentong Environmental Engineering Co., Ltd. (hereinafter referred to as “Chentong Company”) held by Lujian Company. The price of this transaction was determined by the assessed value of Chentong's net assets, which was 79.896 million yuan. Comment: The target company has strong profitability, increasing the company's performance. The main business of Chentong Company is the production and sale of environmental engineering equipment such as dust removal and desulfurization, spare parts, and hardware accessories, and maintenance services. In the 1-11 months of 2013, we achieved cumulative operating income of 100 million yuan and net profit of 7.43 million yuan. The annual net interest rate is expected to be around 7%. Judging from a single profit index, the profitability of the target company is similar to that of Longjing Environmental Protection, a leader in the dust removal industry. We expect to increase the company's 2014 EPS by 0.05 yuan after the merger. The land reserves are sufficient, providing a foundation for the company's subsequent expansion of production capacity. The net assets of the target company have a book value of 14.04 million yuan, an assessed value of 79.9 million yuan, and a value-added portion of 65.86 million yuan, mainly due to the appreciation of the two industrial sites owned by the target company, with a total area of 67,200 square meters. Therefore, in addition to having excellent environmental equipment production and business capacity, the target company also has good reserves of site space. Through this acquisition, the company can increase its market share in the dust removal industry and provide a foundation for subsequent expansion of production capacity and production sites. Demand for dust removal equipment has entered a period of rapid development. As of April 2013, the installed dust removal rate in China is about 51.8%, and there are still about 400 million kilowatt coal-fired power unit dust collectors that need to be upgraded. The state introduced a policy at the end of August to subsidize the price of dust removal electricity by 0.2 points per degree, increasing the enthusiasm of enterprises for transformation to a certain extent. There are only a few months left until the deadline for meeting the standards on July 1, 2014, and the dust removal industry is expected to enter a period of rapid development starting in the fourth quarter of 2013. The company is a leading enterprise in the dust removal industry and will benefit greatly from the increase in industry prosperity. Combined with the current company order situation, performance growth can be expected next year. Foreign investment targets PM2.5 management. The company invested in the establishment of Hangzhou Feida Environmental Technology Research Institute Co., Ltd., a wholly-owned subsidiary in Zhejiang Province, with a total investment of 115 million yuan. Civil engineering projects are expected to be completed within 2 years. Its main business is fine dust PM2.5 treatment technology. The diversification of downstream industries will further increase the company's market size in the field of environmental protection and improve development prospects. Profit forecasts and investment ratings. Considering merger factors, the company's earnings per share for 2013-2015 are expected to be 0.17 yuan, 0.29 yuan, and 0.41 yuan respectively. Based on the latest closing price of 20.46 yuan, the corresponding dynamic price-earnings ratio is 117 times, 71 times, and 50 times, respectively, maintaining the company's “neutral” investment rating. Risk warning: Dust removal equipment renovation demand falls short of expectations; project revenue confirmation delayed