Key investment events: The company released its three-quarter report for 2017 and achieved operating income of 650 million yuan in the third quarter, an increase of 5.18% over the previous year; net profit attributable to shareholders of listed companies was 12.15 million yuan, a year-on-year decrease of 66.42%; non-net profit of 5.97 million yuan, a year-on-year decrease of 79.26%; and basic earnings per share of 0.03 yuan. In the 1-3 quarter, total operating income was 1,976 billion yuan, up 10.29% year on year; net profit attributable to shareholders of listed companies was 70.22 million yuan, down 24.58% year on year; net profit after deducting 54.07 million yuan, down 31.10% year on year; and basic earnings per share of 0.20 yuan. The company expects net profit for the year to be 0.7-132 million yuan, with a year-on-year change of -35% to 10%. The change in performance is mainly due to the company's increased investment in new energy fields such as the fuel cell industry chain, IDC industry chain, energy storage industry chain, and lithium-ion power batteries this year, which is temporarily unable to generate benefits; in addition, the purchase price of raw lead has risen rapidly, leading to a decrease in short-term gross margin; at the same time, the RMB exchange rate has fluctuated greatly, and exchange losses have increased dramatically, which has had a certain impact on performance. Committed to becoming a large new energy group company, fully deploying the fields of lead-acid, lithium batteries, and fuel cells. The company started with lead-acid batteries and has continuously developed new products over the years. It has now formed the three major business systems of lead-acid, lithium batteries, and fuel cells, striving to become a large-scale new energy group company with solutions, financial services, technological innovation, service orientation and orientation for the 21st century. Currently, the company's business is still dominated by lead-acid batteries for the time being. The lithium battery business was greatly expanded in 2017, but its share is still small; the fuel cell business is still in the deployment period. Lithium batteries seek differentiated market positioning. The company's lithium battery products include batteries, BMS management systems, power lines, boxes, connectors, and complete systems. Battery types include ternary, lithium iron phosphate, and lithium manganate, and production capacity is expanding. The company's lithium battery layout advanced relatively late, but its differentiated market positioning strategy is expected to gain an advantage for it. The company's lithium battery products are currently used in communications, energy storage, and bus/logistics vehicles, and have entered overseas markets. In addition, there is great potential for the development of advanced utilization projects under development, and the company's high-quality lead-acid battery customers at home and abroad are expected to become future lithium elevator secondary utilization customers. Comprehensive layout of the fuel cell industry chain. The company has an early layout in the fuel cell field. Through its wholly-owned subsidiary Pengyuan Automation, it holds 21.74% of the shares of Hydrogen PuChuangneng, and plans to invest no more than 500 million yuan to establish H2Xion Battery, mainly to develop fuel cells and related businesses; at the same time, it plans to invest no more than 300 million yuan to establish Xiongtao Investment, which mainly actively integrates the company's industrial layout through investment means. At present, the company has carried out relevant research and industrial layout on important links in the fuel cell industry chain through endogenesis and extension, and is committed to becoming a leading enterprise in the fuel cell field in the future. Investment suggestions: The company's revenue for 2017-2019 is estimated to be 26.47, 31.10, and 3.834 billion yuan, respectively, up 6%, 17%, and 23% year-on-year respectively; EPS is 0.37, 0.57, and 0.72 yuan, respectively, and 51, 33, and 26 for three-year PE. For the first coverage, the target price is 20 yuan, giving it an “increase in holdings” rating. Risk warning events: Fund-raising projects fell short of expectations, fuel cell development fell short of expectations, and lead-acid battery industry development fell short of expectations.