Incident: The company announced that the issuance of shares to purchase assets and raise supporting capital was approved by the Securities Regulatory Commission. The company purchased 100% of Runxing Technology's shares by issuing shares and purchasing in cash for 2.95 billion yuan, including paying 826 million yuan in cash, paying 2,124 million yuan for issuing shares, issuing 8.88 yuan/share, and issuing 239 million shares. At the same time, it plans to raise no more than 858 million yuan in supporting capital. Runxing Technology's 2017-2019 performance promises net profit of not less than 250, 3 and 360 million yuan. Comment: The company successfully entered the metal CNC field through the acquisition of Runxing Technology and further expanded the company's industrial layout. Runxing Technology is a leading domestic CNC equipment company and is expected to benefit from the dividends brought by the rapid growth of the industry and increased industry concentration. “Double-sided glass+metal middle frame” provides a new growth engine for metal CNC and glass machines: ① On the one hand, metal middle frames are more complicated than traditional metal back plate processing, and the industry's demand for metal CNC will further increase; on the other hand, as the pace of securitization of precision structural parts companies collectively accelerates, it is imperative to buy equipment and raise production capacity to seize market share. The double stimulus has stimulated new demand for metal CNC. In the future, whether it is 2.5D, 3D glass or ceramic covers, the metal middle frame will be reinforced. The penetration rate of metal middle frames is expected to increase further in the future. Metal CNC companies are expected to fully enjoy the dividends brought by the growth of the industry. The main business is gradually picking up, and container handling equipment is expected to grow steadily. The company's original main business was the stainless steel business, which mainly focused on R&D, production and trade of container handling equipment. The container handling equipment business is expected to grow steadily under the guidance and impetus of the country's “Belt and Road” and “Yangtze River Economic Belt” related policies; the stainless steel industry benefits from deepening supply-side reforms, the steel industry removes production capacity, and its own perfect business layout, and the company's stainless steel business is expected to develop by leaps and bounds. Profit forecast and rating: The company's net profit for 2017-19 is estimated to be 0.42, 0.61, and 93 million yuan, corresponding EPS of 0.06, 0.09, 0.13 yuan/share, and corresponding PE of 186, 127, and 84X. Assuming that the acquisition of Runxing Technology is completed in 2017, the company's net profit for the 2017-19 exam preparation is 1.22, 3.81 million yuan, and 473 million yuan, respectively. The corresponding EPS for the 2017-19 exam preparation is 0.12, 0.38, and 0.47 yuan/share, respectively, and the corresponding PE is 91, 29, and 23X, respectively. Maintain the company's “recommended” investment rating. Risk warning: The development of the CNC industry falls short of expectations, and there is a risk that traditional business will decline.