Key investment points: Automotive electric pump leader, multi-use development and transformation solution service provider. Since its establishment, the company has been focusing on the field of automobile steering pumps and gear pumps, maintaining a high level of profitability and technical strength. In recent years, in line with automobile market conditions, the company has actively developed new products and implemented mergers and acquisitions. It has gradually formed three major business segments, including pumps and electric pumps, motors and automotive electronics, insulation and noise reduction (NVH), and weight reduction (NVH), and weight reduction, realizing the transformation from focusing on steering systems to a comprehensive supplier of auto parts for steering, transmission, braking, automotive electronics, body, etc., and the market competitiveness has further increased. The acquisition of German CCI, extended mergers and acquisitions opened up international layout. During the reporting period, the company purchased all of Fuxin Jiachuang's shares and bonds through cash payments of 1 billion yuan of self-raised yuan and external investors invested 937 million yuan, and finally completed the acquisition of German CCI. CCI is a professional provider of high-quality automotive sound and insulation products. It has long served world-class automobile groups such as Mercedes-Benz, BMW, Audi, Ford, Volkswagen, and Renault Nissan. It achieved revenue of 432 million yuan in May-June 2017, accounting for 54.26% of the company's revenue. With this merger and acquisition, on the one hand, the company diversified products and enhanced the company's performance; secondly, it obtained the opportunity to reach more high-end customers, in line with the international layout strategy. New product reserves are full, opening up future profit margins. After years of technical preparation, the company began to gradually implement electric pump products such as EPS motors, electrohydraulic steering pumps (EHPS), electric pumps for transmission systems (EOP), electric vacuum pumps, automotive electronics (PEPS) keyless entry and start systems, light sensors), and automatic transmission oil pumps. After years of technical preparation, the company began to gradually implement products such as electric pump products such as EPS motors, electrohydraulic steering pumps (EHPS), electric pumps for transmission systems (EOP), etc. Sales revenue for new products such as electrohydraulic pumps, automatic transmission oil pumps, and automotive electronics increased by 206.79% year over year. Among them, EHPS has supplied batches to Xiamen Jinlong, SAIC Motor commercial vehicles, etc., and will achieve batch supply of important models to internationally renowned automobile manufacturers in the second half of 2017, and the procurement volume will reach 300,000 units in 2018. Production capacity is in short supply, and production capacity will be increased by 500,000 units in the future. In the second half of this year, EOP began batch supply of SAIC passenger cars and Shandong Shengrui. Automatic transmission oil pump products have been delivered in batches to SAIC transmission and other customers, while production capacity for transmission oil pumps will also be increased by 1 million units. EPS motor products have been provided to domestic customers for prototype testing. We believe that with the continuous development of the new energy vehicle and smart car industry and the continuous increase in energy saving and environmental protection requirements, it will drive both the penetration rate and added value of the company's new products, and future profit margins have opened up. Employee stock ownership plans help the company develop healthily in the long term. In 2017, the company completed the restricted stock incentive plan: $37.10 per share was issued to 88 middle and senior management, core technical and business personnel of the company and subsidiaries, and a total of 4.93 million restricted shares were issued. We believe that this equity incentive plan will help stimulate the enthusiasm of the company's management and improve operating efficiency, and is a strong agent for the company's long-term healthy development. Profit forecast and investment rating: It is estimated that the company's earnings per share in 2017/2018/2019 were 1.33/2.57/3.46 yuan, respectively, and the corresponding PE was 36/18/14 times, respectively. Driven by high growth expectations next year, it was given a “buy” rating for the first time. Risk warning: the risk that the sales volume of the new product will not meet expectations; the risk that the sales volume of the automobile market will not meet expectations; the risk that the performance of the target acquisition will not meet expectations.