In the first half of 2017, the company achieved a 55.62% year-on-year increase in revenue, a 10.49% year-on-year increase in net profit, and an increase of 17.51% year-on-year after deduction. The company's new production capacity is gradually being released, and the industrial chain layout is gradually improving. Diversified development is progressing steadily, and the prospects for digital projects, environmental protection projects and new materials projects are promising. Maintaining the buying rating, the target price was lowered to $8.40. Key points supporting ratings Net profit for the first half of 2017 increased 10.49% year over year, in line with expectations. In the first half of 2017, the company achieved operating income of 72.170.2 million yuan, a year-on-year increase of 55.62%; realized net profit of 61.57 million yuan, a year-on-year increase of 10.49%, a year-on-year increase of 17.51% after deduction; and achieved basic earnings per share of 0.09 yuan, which was basically the same as the same period last year, and the performance was basically in line with expectations. The increase in the company's performance was mainly due to the increase in sales of new dye products and the increase in sales brought about by the “Colorful Cloud” platform. In addition, the company's Yantai fine chemical intermediates project with an annual output of 30,000 tons was initially completed, and some intermediates were put into production. The company's gross margin declined in the first half of the year. The company's gross margin in the first half of the year decreased by 6.91 percentage points compared to the same period last year, mainly due to the sharp increase in operating revenue of the “Colorful Cloud” e-commerce platform, and the low gross margin of platform trade sales, which affected the decline in overall gross margin. Diversified development is progressing steadily, and the prospects for digital projects, environmental protection projects and new materials projects are promising. While steadily developing the dye business, the company proactively lays out the digital printing business, environmental protection projects, and new materials business represented by thermoplastic elastomers, artificial lenses, etc., and has set up related divisions separately to actively expand the three-dimensional space for the company's future development. The country's first digital printing nozzle equipment production line jointly developed by the company and Suzhou Ruifa has already been built. In the future, the company's ink can be sold collaboratively with the nozzle, rapidly increasing the operating income and net profit of digital ink; in March 2017, the company participated in Shanghai Yifan, holding 16.67% of the shares, and jointly carried out R&D and production of thermoplastic elastomer materials. In the first half of the year, the company achieved revenue of 31.21 million yuan and achieved net profit of 3.08 million yuan; The company and Shanghai Jiao Tong University established a new material research and development center to establish a long-term strategic partnership. The main risks facing ratings are abnormal fluctuations in dye prices, poor market development, and the progress of new projects falling short of expectations. The valuation company's differentiated development is positioned in the middle and high-end dye market. New production capacity is gradually being released, and it has entered a period of rapid growth; the new materials business continues to break through, and the future is worth looking forward to. Earnings per share for 2017 are expected to be $0.21, maintaining the buying rating. The target price was lowered from $9.90 to $8.40.