Matters: The company announced its 17-year performance forecast today. It expects revenue for the full year of 2017 to be 4.98 billion yuan, up 40.8% year on year, and net profit of 700 million yuan, up 455.5% year on year. Of these, revenue for the fourth quarter was 1.32 billion yuan, up 193%, and net profit was 180 million yuan, up 104%. At the same time, the company announced that it plans to acquire 60% of the shares of Argentinian agrochemical products dealer Ruralco with 8 million US dollars and 15 million US dollars of physical products. Ruralco has obtained 37 exclusively maintained customers and 33 product registration certificates or the right to use registration certificates from the original shareholder FMC. Key points 1. Prices of major pesticide products all rose in the fourth quarter. The company that benefited greatly from the company's performance was the leading domestic paraquat. After the acquisition of Shandong Kexin in '17, the competitive pattern of the paraquat industry improved dramatically. Combined with environmental protection, the price of paraquat rose from 20,000 yuan/ton to 23,000 yuan/ton in the fourth quarter, and only 13,000 yuan/ton in the same period in 2016. The company currently has more than 20,000 tons of paraquat production capacity, benefiting greatly from the increase in product prices. In addition, the prices of the company's other products, such as diazepam, imidacloprid, and chlorpyrifos, etc., have all risen sharply; only the price of VB3 has declined slightly from month to month. 2. It is expected that new production of pyridine and nicotinamide will be put into operation in 2018. The card position advantage company, which has long been optimistic about pyridine, is expected to start production of 8000 tons of dimethoxam and 10,000 tons of nicotinamide in the first half of '18. Among them, the cost of the new production capacity of dimethoxysine will be reduced by 20%-30% compared to the current cost, and the launch of the new production capacity will drive continuous growth in the company's performance. In our in-depth company report released earlier, we estimated the main downstream demand for pyridine over the next three years, believing that pyridine will become the core profit link in the industrial chain. The company currently has a production capacity of 620,000 tons of pyridine base (20% market share). It is the world's largest pyridine manufacturer. It continues to expand downstream to build the entire pyridine industry chain. The card position advantage will help the company stand out in long-term competition. 3. Investment advice: We expect the company's net profit in 17-19 to be 700 million yuan, 9.4 billion yuan, and 1.1 billion yuan, corresponding to EPS of 1.21, 1.61, and 1.92 respectively. The current stock prices correspond to PE19X, 14X, and 12X, maintaining the “recommended” rating. 4. Risk warning: Sales of new production capacity fell short of expectations, and the price of VB3 fell sharply.