Key investment highlights Company news: The company disclosed its 2017 annual report. Sales revenue rose 66.2% year on year to reach 2.165 billion yuan, gross margin level was 29.3%, down 2.8 percentage points year on year. Net profit attributable to shareholders of listed companies was 222 million yuan, up 17.7% year on year, and net profit per share was 0.78 yuan, down 9.3% year on year. In the fourth quarter of 2017, the company achieved operating income of 702 million yuan, an increase of 75.2% year on year, and net profit attributable to shareholders of listed companies was 104 million yuan, up 63.1% year on year. The 2017 profit distribution plan is to distribute a cash dividend of 2.50 yuan (tax included) for every 10 shares, and a capital reserve fund will be used to transfer 4 shares for every 10 shares to all shareholders. Comment: Revenue continues to grow rapidly, and net profit is under pressure in the short term: the upgrading of high-end consumer electronics products, the continued penetration of low-end products, the rise of artificial intelligence, and the growth of the medical device industry continued to bring growth to the company's precision metal manufacturing business. The company's sales revenue in 2017 was 2.17 billion yuan, up 66.2% year on year. The increase in product numbers and market share in the consumer electronics business drove the company's performance growth. Net profit attributable to shareholders of listed companies in 2017 was 222 million yuan, up 17.7% year on year. The company has reserved more R&D projects for the consumer electronics and medical devices sector. Major customers have high R&D costs for new products, short mass production times, and limited contribution to the company's performance, which dragged down the company's net profit growth in the short term. Revenue and profit increased in the fourth quarter: In the fourth quarter of 2017, the company achieved operating income of 702 million yuan, an increase of 75.2% over the previous year, and net profit attributable to shareholders of listed companies was 104 million yuan, up 63.1% year on year. The fourth quarter entered the peak shipping season for the company's major customers. The company's revenue and net profit growth rate were higher than the annual average, and the company's profitability was released as production capacity climbed. As the company transfers production capacity to new products from major customers, orders for new products fall short of expectations, and insufficient production capacity, putting a lot of pressure on the company's gross margin. Future development strategy and business plan: Continue to expand product categories and enhance profitability: The company will further improve the technical level of high-precision metal structural parts manufacturing, continue to increase the product categories provided to existing customers, increase the market share of various products, and strive to expand the company's sales scale; at the same time, replicate the existing business model in other application areas and continue to develop internationally renowned customers. Based on its own intelligent equipment team, the company will continue to increase the automated transformation and application of existing production lines, continuously reduce the loss of raw materials and the number of personnel, and improve the company's profit level. Investment advice: Our company predicts earnings per share of 1.37, 1.60, and 1.78 yuan for 2018 to 2020, respectively. The return on net assets was 19.0%, 19.9%, and 19.4%, respectively, with buy-B recommendations. Risk warning: the price gradient of new products from major customers is large, and high-priced products or shipments fall short of expectations; increased competition in the industrial chain affects the company's profitability; product line expansion falls short of expectations;