Ping An's view: Still a gas filling equipment manufacturer to a provider of overall clean energy solutions: Houpu Co., Ltd. is a leading gas filling equipment company in China, with a domestic market share close to 40%. In 2015, the company acquired Sichuan Hongda (energy engineering design and general contracting) and Chengdu Corell (low temperature refrigeration technology), and Chongqing Xinyu (pressure vessel design and manufacturing) in 2016. The company gradually gained the ability to provide equipment for the entire natural gas industry chain and overall solutions for the clean energy sector. In the future, the company will focus on Sichuan Hongda, a wholly-owned subsidiary, to comprehensively develop the entire industry chain development strategy. The penetration rate of heavy LNG trucks continues to rise, and demand for gas stations is expected to recover: as China's environmental protection policies become more stringent and domestic oil and gas reforms gradually advance in depth, China's natural gas industry will usher in a golden period of rapid development in the next five years. From January to August 2017, the cumulative total sales volume of heavy LNG trucks in China reached 55,312 units, an increase of 547.30% over the previous year. We believe that one of the main reasons for the boom in production and sales of LNG heavy trucks this year is that environmental policies have become stricter, and this factor will continue to exist in the future. The penetration rate of heavy LNG trucks is expected to increase further, which in turn will drive demand for LNG filling stations. A cooperation agreement was signed with the Yongchuan government to develop shale gas, and the next year's performance will increase significantly: on August 28, 2017, Houpu Co., Ltd. signed a “Strategic Cooperation Agreement on the Comprehensive Utilization of Shale Gas” with the People's Government of Yongchuan District of Chongqing. It is estimated that the total investment scale of the entire agreement is about RMB 4 billion. The terms of the agreement show that the company enjoys a relatively large degree of initiative throughout the execution of the agreement. It is expected that a large percentage of the projects covered by the agreement will be converted into the company's operating income, significantly increasing its performance in the following years. Investment proposal: With the completion of the acquisition of companies such as Sichuan Hongda, Houpu Co., Ltd. has become a pure gas filling equipment manufacturer and transformed into an overall clean energy solution provider. In August 2017, the company signed a cooperation agreement with the government of Yongchuan District of Chongqing to develop shale gas. The agreement involved a total investment of about 4 billion dollars, which is expected to significantly increase the company's performance in the following years. The company's 2017-2019 EPS is expected to be 0.46 yuan, 0.81 yuan, and 1.19 yuan, respectively, and the price-earnings ratio corresponding to the current stock price is 38 times, 21 times, and 15 times, respectively. First coverage, giving a “Highly Recommended” rating. Risk warning: (1) the oil and gas reform has not progressed as expected; (2) the agreement with the Yeongcheon Municipal Government has not progressed as expected.