Incident: On January 18, Zhenhua Heavy Industries announced that it received a court ruling with Fluor Limited. The company expects to pay approximately RMB 55 million (excluding interest, VAT, legal fees and other expenses relating to the undetermined amount) after deducting the paid guarantee of €23,409,750 (which has been included in the profit and loss of the previous year), to be recorded as profit and loss in 2017. Major lawsuits have settled, and uncertainty has been reduced: The lawsuit plagued the company for many years. Flour initially claimed 250 million pounds. After lengthy litigation and coordination, the final compensation was about 230 million yuan. In fact, another 55 million yuan will have to be paid. After the case is settled, the uncertain impact of major lawsuits on the company will be greatly reduced. Along with the gradual recovery of the shipping market and oil prices, business disputes such as the company's special engineering vessels are expected to take a turn one after another. Automated terminals are expanding overseas, offshore equipment risks have been cleared, and various types of automated high-end manufacturing are gradually gaining strength: in an environment where global trade is steadily recovering, ports around the world are expected to accelerate the pace of automation. The company successfully signed an automated terminal project in India at the end of 2017, and has now signed 5 automated terminal projects. Smart terminal equipment such as automated terminals, unmanned transporters, and remote control will gradually change the way terminals operate, and they are optimistic about the company's layout on smart terminals. The company's offshore platform business has bottomed out, and the impairment plan is relatively adequate, and the industry is expected to show signs of gradual recovery. Investment advice: Continue to maintain the industry outlook and company judgment in our two in-depth reports “Building the Industry, Moving Forward with Innovation” and “Container Cranes — Building the Maritime Silk Road” in June 2017. Benefiting from the recovery and development of the global economy and shipping industry, building a new generation of smart ports, and realizing terminal intelligence has become a new trend in the development of the industry, optimistic about the development prospects of the industry leader Zhenhua Heavy Industries, and the risk of offshore business has been clarified. The quality of operating assets has improved markedly, and the margin of safety has increased dramatically, and continues to maintain the buy-A rating. Risk warning: The recovery of the global economy and shipping industry fell short of expectations; demand for smart terminal construction fell short of expectations; and the integration of industrial chain platforms fell short of expectations.