The company's recent situation, the company's lithium carbonate production line technology improvement is going well, and it is expected that trial production will be ignited in the near future. Meanwhile, the lithium mine and lithium carbonate markets are rising, driving up market expectations. Recently, the company's stock price has continued to rise. Comment If the technology of the lithium carbonate production line is successfully improved, its contribution to performance will be greatly increased. Through years of R&D and testing, the company is expected to complete the technical transformation of the lithium carbonate production line in the near future. The production capacity is expected to increase to 5,000 tons, and the cost is expected to drop from 90,000 yuan to 70,000 yuan/ton. If the company's lepidolite mining production capacity is supported, costs are expected to drop further. At the same time, the company is actively promoting the expansion of the lithium carbonate production line. According to the company's plan, the lithium carbonate production capacity of 1H18's lepidolite is expected to reach 15,000 tons. In addition, the company cooperated with Baowei Materials to use spodumene to produce lithium carbonate, which is expected to form a production capacity of 10,000 tons of lithium carbonate and 5,000 tons of lithium hydroxide in 2018. After all production is reached, the company's lithium carbonate+lithium hydroxide production capacity will reach about 30,000 tons, and the performance is very flexible. If technical reform is not successful in the short term, the downside risk is small. (1) When it comes to lithium carbonate extraction technology from lepidolite, only domestic companies are experimenting. Jiangte is at the forefront of technology research and development, and has now achieved small-batch production. Even if the lithium carbonate production line is not successful in the short term after technical reform, we believe that the company can achieve mass production through continuous research and development in the future; (2) the current price of lithiolite ore has also risen sharply to 1,600 to 2,000 yuan/ton. The company has 2/3 of Yichun's lithiolite mineral resources, which are huge in value, which supports the company's valuation; (3) the company and Baowei cooperate to follow the mature lithium carbonate route. As the new production capacity is put into operation next year, it will also support the company's performance. Large orders from Kowloon are expected to contribute to growth throughout the year. 1H17 New energy vehicle revenue fell 78.4% year on year to 111 million yuan due to policy adjustments. Recently, however, the company has successively signed two large orders for Yinlong and National Transportation, with a total amount of 4 billion yuan, which will be completed before the end of 2018. We expect order delivery to begin in 3Q17, and the bus and logistics vehicle market will pick up from June. Kowloon is expected to fulfill its performance promise of the remaining $221 million in 2017, and is expected to achieve high performance growth in 2018. The valuation recommendations take into account the cost reduction brought about by technological reforms and the commissioning of new production lines. We raised the 2018 EPS forecast by 24% to 0.38 yuan. The company's target price was raised by 23.3% to 18.34 yuan, maintaining the recommendation. Production and sales of risky new energy vehicles fell short of expectations; progress in the technical improvement and expansion of lithium carbonate production slowed down.