Event: Jinglan Technology announced its third quarter report. The company achieved operating income of 914 million yuan in the first three quarters, an increase of 2976% over the previous year, net profit attributable to shareholders of listed companies of 144 million yuan, a year-on-year increase of 550.27%, and EPS of 0.21 yuan. Among them, it achieved revenue of 436 million yuan and contributed 42.94 million yuan in profit in the third quarter. Performance was in line with expectations, and net profit was above the median profit forecast. Opinion: The business is developing steadily, and the performance is in line with expectations. The company achieved operating income of 914 million yuan and net profit attributable to shareholders of listed companies of 144 million yuan in the first three quarters. Due to the low base for the same period last year, the company's net revenue and profit increased significantly year over year. The overall performance was in line with expectations and was above the median performance forecast. Northern gardens were merged during the reporting period, so the company's projects, including accounts receivable and payable, long-term loans, and goodwill, have all experienced significant growth. The company's operating cash flow is 741 million yuan. There is some pressure on cash flow, mainly because the company is in the business development stage, and participating smart ecology and energy technology projects require a repayment cycle of 1-2 years. The company is also actively financing through short, medium, and long-term loans, fixed increases, etc. We expect that after the company's early projects enter the repayment period one after another and the company's business sector layout is gradually completed, the pressure on cash flow will gradually ease. Northern gardens were successfully merged, and the integration of extended mergers and acquisitions was efficient. The company announced in February 2017 that it intends to acquire 90.11% of Beifang Garden's shares. The plan was conditionally approved on June 1, and Beifang Garden completed the transfer on September 15. It took less than a year from the announcement of the plan to the completion of the transfer, which fully reflects the company's ability to integrate resources and efficiently execute the outsourcing of mergers and acquisitions. The time it took less than a month for Northern Garden to merge into the company and the announcement to win the bid for the garden project of nearly 1 billion yuan fully demonstrated the impact of the company's platform resources on the Northern Garden business. Previously, Jinglan Muhe and Beifang Garden won the bid for an efficient water-saving irrigation PPP project in the Zoucheng Lake East Irrigation District, which also reflected the synergy between the company's various business segments. Winning the bid this time is an important step in the company's business development in the field of garden ecology. It is also an important layout for the company to further consolidate its layout in the northern region and enter the Shandong region. It is expected that the garden sector will receive orders later. As an important link in the company's water resources ecological management chain, the successful addition of Beifang Garden is conducive to the integration and collaboration of customer resources and order resources among all sections of the company. The large ecological layout is gradually being established, and orders are steadily increasing, and performance is safe. In just two years, the company has continuously improved the company's ecological pattern through endogenous epitaxial extension, acquired Muhe water saving and northern gardens, introduced water-saving irrigation and garden ecological restoration, and acquired the Liaohe River Bureau to improve the layout of the water conservancy engineering industry. Recently, it also signed a cooperation agreement with Oriental Ecology to jointly promote intelligent irrigation technology, further enhancing the company's service capabilities as a comprehensive service provider for smart ecology. The company's business layout is progressing step by step. The company's big ecology+Internet pattern is gradually being formed, and the operation of various sections is gradually on the right track. 80%-90% of the pre-framework agreements in the ecological sector have been converted into orders, and the steady increase in order size has provided a guarantee for the expansion of the company's performance. The main construction of Energy Technology's early dry quenching and formaldehyde projects (with a total scale of 500 million) has been completed, and full benefits may be confirmed within the year. Conclusion: We are optimistic about the company's gradually improved ecological layout and the steady growth in performance brought about by the successive implementation of early reserve frameworks. We estimate that the company's net profit in 17-19 was 3.85/512/679 million, respectively. EPS was slightly diluted due to fixed growth in gardens in the north. It is estimated that EPS in 17-19 was 0.53/0.70/0.93 yuan, and corresponding PE was 26/20/15 times, respectively, maintaining the “highly recommended” rating. Risk warning: business integration falls short of expectations; order execution falls short of expectations