Matters: The company and Wuhan Institute of Geological Resources and Environmental Technology Co., Ltd. (“IGE” for short) signed a “Strategic Cooperation Agreement” in the Chengdu High-tech Zone on September 22, 2017 to establish a strategic cooperative relationship on the application and promotion of hydrogen fuel cell vehicles. Key investment points 1. Actively lay out the hydrogen fuel cell vehicle sector, and the hydrogen energy equipment business is expected to create new growth points. The purpose of this strategic cooperation agreement is: 1) to jointly absorb advanced technology from third parties in 70 MPa and 35 MPa hydrogen fueling station equipment to localize key hydrogen station equipment and reduce hydrogen station investment costs; 2) the two sides give full play to their respective superior resources and are committed to jointly reducing the cost of hydrogen preparation, storage, transportation and use; 3) The two sides will give full play to their respective advantages in the application and promotion of hydrogen fuel cell vehicles, focusing on developing users in central China and Sichuan. Through this cooperation, the company will substantially participate in the field of hydrogen fuel cell vehicles and accumulate core technologies related to 70 MPa and 35 MPa hydrogen refueling stations, laying a solid foundation for the company's next step in mass production and marketing of related hydrogen energy equipment. 3. The industry is at an inflection point. I am optimistic about the development prospects of the fuel cell vehicle industry. Since the end of 2016, all parties have taken frequent actions: 1) In December 2016, the State Council issued the “13th Five-Year Plan”, which requires promoting the development of in-vehicle hydrogen storage systems and hydrogen preparation, storage, transportation and filling technology during the 13th Five-Year Plan period, promoting the construction of hydrogen fueling stations, and granting huge subsidies of up to 500,000 yuan/unit for fuel cell vehicles; 2) In August 2017, China's first automated hydrogen engine fuel cell mass production line built by Yihuatong It has been officially put into operation. The production line has an estimated annual production capacity of about 10,000 fuel cell engines, with a total project investment of 1 billion yuan; 3) In September 2017, the Shanghai Municipal Commission for Science and Technology, the Municipal Economic and Credit Commission, and the Municipal Development and Reform Commission jointly issued the “Shanghai Fuel Cell Vehicle Development Plan”, which plans to build 50 hydrogen fueling stations in 2025 and promote 30,000 fuel cell vehicles. From 2026 to 2030, the annual output value of the entire Shanghai fuel cell vehicle industry chain will exceed 300 billion yuan. In the context of various parties increasing the fuel cell vehicle industry, we believe that fuel cells already have large-scale industrial production capabilities, and the fuel cell vehicle industry will enter a stage of rapid industrialization in the future. 3. Natural gas & hydrogen two-wheel drive, the company's clean energy industry chain development strategy continues to be implemented, benefiting from the clean energy industry chain layout strategy that has been continuously promoted since listing. The company has successively acquired high-quality targets such as Coreal, Honda, and Chongqing Xinyu Company. The company's business scope has been greatly expanded, and it has a full set of qualifications as an overall solution service provider for the entire natural gas industry chain (excluding mining), and initially built the layout of the entire natural gas industry chain. This time, the company is actively expanding the hydrogen energy industry, fully integrating its own and the industry's high-quality industrial resources, jointly promoting and popularizing hydrogen fuel cell vehicles throughout the country, continuously broadening its business caliber, and adapting to the company's development strategy for clean energy industry chain applications, which will create new business growth points for the company. 4. Profit forecast: The company is expected to achieve net profit of 199 million, 304 million, and 396 million yuan in 17-19. The corresponding EPS is 0.54 yuan, 0.82 yuan, and 1.07 yuan, and the corresponding PE is 32X, 21X, and 16X, maintaining a highly recommended rating. 5. Risk warning: The progress of the original business fell short of expectations.