Incident: On the evening of November 17, the company issued an announcement stating that the company's non-public offering of shares was approved by the Securities Regulatory Commission: Approval was approved for the company's non-public offering of no more than 159.27 million new shares, valid for 6 months. Our comments on this are as follows: Investment points: The fixed increase has been approved, and the fund-raising project is conducive to the long-term development of the company. The current non-public offering of shares should not exceed 159.27 million shares, and the capital raised should not exceed 920 million yuan. It is proposed to use the capital raised to invest in the following projects: 1) the acquisition of 30% of the shares of Xingang Thermal Power (300 million yuan); 2) the Xingang Thermal Power Improvement and Expansion Project (300 million yuan); 3) the flue gas treatment technology transformation project (110 million yuan); 4) the combustion system technology transformation project (80 million yuan); 5) the cogeneration project in the northern area of Liyang City (130 million yuan). Xingang Project: The company previously held 70% of the shares in Xingang Thermal Power, and the remaining 30% of the shares were first acquired using its own capital on March 20, 2017. The acquisition of the remaining 30% of the shares of Xingang Thermal Power can not only improve the company's decision-making efficiency, but also enhance the company's performance. In addition, the new port project was remodeled and expanded to meet the increased load on the park and increase the benefits of the project; flue gas treatment and combustion system technology transformation: meeting the now increasingly stringent environmental requirements and achieving ultra-clean emissions, thus indirectly increasing the company's profits. Liyang project: Invest in a cogeneration project in the North Area, and the company's cogeneration project goes one more city. This fixed increase has been approved, and it is expected that the company will complete it soon. It can not only expand the scale of the company's projects and improve the company's sustainable development capabilities, but also reduce financial expenses, increase the company's performance, and facilitate the company's long-term development. Although environmental inspections have had an impact in the short term, they are still beneficial to the company's development in the long term. The park where the company is located has been affected by the suspension of production to varying degrees. The load on enterprises in the park has declined, causing the company's attributable net profit (43.8375 million yuan) in the third quarter to fall 13.99% year on year. We believe that although environmental inspection has an impact in the short term, it is beneficial to the company's development in the long term: on the one hand, the enterprises where the park is located have basically been strictly approved by government departments, and there is a certain entry threshold. Most enterprises still have to resume production after stopping production and rectification. It is expected that they will gradually return to normal in the fourth quarter; on the other hand, under the stricter policy guidance of national environmental inspection, local governments have promoted enterprises to “enter the park”, driving up the load on the park, which is conducive to the development of the company's business. Focusing on “solid waste disposal+energy saving and environmental protection” to accelerate epitaxial and endogenous growth, the company continues to expand epitaxial and endogenous growth. It acquires at least one project every year through investment and acquisition. Currently, it has projects such as Fuyang (100%), Donggang (51%), Xingang (100%), Qingyuan (60%), Liyang (100%), Chang'an (92%), etc., with a heating capacity of 2400t/h and a sludge disposal capacity of 7000t/d. The company plans to privately acquire the remaining 30% of the shares in the Xingang project. We believe that the company will not rule out the possibility of acquiring the remaining shares in other projects in the future. On the other hand, through capital and management advantages, the company achieved endogenous growth through technical reform and expansion of ongoing projects. In the first three quarters of 2017, the company achieved revenue of 2,476 billion yuan (+32.98%) and net vested profit of 248 million yuan (+37.30%). At the same time, it is predicted that the company will achieve net vested profit of 318-392 million yuan (+30-60%) throughout the year. We believe that the company's model of achieving internal and external growth through offsite replication is expected to continue. The increase in executive holdings shows confidence that the stock price has a margin of safety. On September 4, 2017, Mr. Zhang Jie, the chairman and director of the company, Mr. Zhang Zhongmei, director and general manager, and Mr. Wu Bin, the director, increased their holdings by 2.6 million shares through the secondary market, involving an amount of 30 million yuan. The price increase was equivalent to 11.54 yuan/share. The increase in holdings of company executives shows, on the one hand, full confidence in the company's future development. On the other hand, the current stock price is 10.49 yuan. The increase in holdings establishes a margin of safety and is optimistic about the company's long-term development. Profit Forecast and Investment Rating: Maintain an “Excess” rating. Affected by environmental inspections, we downgraded the company's performance, but we are still optimistic about the company's “solid waste disposal+energy saving and environmental protection” circular economy model and the long-term development logic of replicating internal and external growth from other places. Regardless of the impact of additional issuance on the company's performance and share capital, we expect the company's 2017-2019 EPS to be 0.45, 0.62, and 0.74 yuan respectively, corresponding to the current stock price PE of 24, 17, and 14 times, maintaining the company's “increased holdings” rating. Risk warning: downside macroeconomic risk, offsite replication, extended mergers and acquisitions that fall short of expectations, risk of steam price reduction, risk of falling demand for park enterprises, risk of falling demand for park enterprises, risk that non-public offerings will not be completed successfully