Incident The Company announced its 2013 three-quarter report. In January-September, the company achieved operating income of 1,285 billion yuan, an increase of 31.35% over the previous year; net profit attributable to shareholders of listed companies of 71.085 million yuan, an increase of 12.15% over the previous year; and earnings per share of 0.3 yuan. Briefly, abundant orders in the smart terminal business led to increased revenue, and the company's revenue growth in the first three quarters mainly benefited from the release of production capacity and increased sales orders for smart terminal products such as mobile phones and tablets. The capacity utilization rate of the company's Shenzhen production line is high, and the new production line in Tianjin is launched relatively late, so the release of production capacity is slightly slower. The company has successfully cooperated with major domestic customers. It has developed PON for ZTE, LTE gateways for Huawei, and deepened cooperation with Lenovo and its ODM manufacturers, supplying about 1 million smartphones per month. Furthermore, the company has further deepened its cooperation with overseas customers. It not only operates step by step, enters the Samsung industry chain, manufactures smart TV WIFI module and circuit boards, and has manufactured high-margin OEM pad machines for Turkish and Brazilian customers, and has also developed business cooperation with German and American companies. The continuous upgrading of the product structure and the active expansion of customers have led to a steady increase in the company's business revenue. Costs increased, gross margin decreased, and the company's gross margin fell by 3 percentage points in a single quarter in the third quarter. In addition to the increased cost of new equipment and the increased cost of expanding sales, the increase in personnel costs was also an important reason for the decline in gross margin. The increase in corporate orders and the large-scale expansion of production lines have followed a sharp increase in the demand for personnel. However, the industry began to enter the peak season in the third quarter, and the supply of workers in the industry was in short supply, making it more difficult to recruit workers and staff wages. Profit forecast Although there was a slight decline in net profit for a single quarter in the third quarter, the company's orders were sufficient. Considering that orders for consumer electronics products such as Christmas were settled at the end of the year, it is expected that the quarterly revenue for the fourth quarter will continue to grow month-on-month (revenue will be 7-800 million yuan), so we are still optimistic about full-year performance growth. It is predicted that the company's 2013-2015 EPS will be 0.58 yuan, 0.85 yuan, and 1.07 yuan respectively, maintaining the “increase in holdings” rating, and the target price is 17.5 yuan.