Event: Mr. Jiang Tao, the company's controlling shareholder and actual controller, plans to increase the company's shares through the trading system of the Shenzhen Stock Exchange with its own or self-raised funds within 6 months from February 24, 2018, with a planned increase of RMB 10 million-100 million yuan; the company's trading has been suspended since the opening of the market on February 5, 2018 due to major issues of asset purchase. As a result of the company's decision to stop planning this major event, the company's shares resumed trading on February 26, 2018.

Comments:

1. Based on the serious underestimation of the market capitalization of the company, Mr. Jiang Tao agrees with the strategic layout of the company in the field of natural gas utilization and the intrinsic value of the company, and is willing to develop together with the company for a long time to demonstrate his confidence in the company.

two。 As of the date of the company announcement, Mr. Jiang Tao held 119.675 million shares of the company, accounting for 32.29% of the total shares of the company. The proposed increase does not exceed 2% of the total share capital of the company, and the proposed increase price does not exceed 12.00 yuan per share. The current share price of the company is 8.6 yuan, which helps to maintain the normal development of the stock price, enhance investor confidence, and is a good news for the long-term development of the company.

3. Due to the wide gap between the two sides on the quotation for this transaction, no agreement could be reached. The counterparty of the transaction sent a letter of termination to the company on February 22, 2018, and decided to terminate the planning of this major event. In order to protect the interests of all shareholders and the company, after careful study, the company agreed to stop planning this asset purchase. The termination of the planning of major events will not adversely affect the normal production and operation of the company, and there will be no harm to the interests of the company and all shareholders, especially minority shareholders.

Investment advice and rating: the company's net profit from 2017 to 2019 is expected to be 36 million yuan, 175 million yuan and 210 million yuan, and the EPS is 0.1,0.47 yuan and 0.57 yuan, with a price-to-earnings ratio of 90 times, 18 times and 15 times respectively. Give a "buy" rating.

Risk hint: the development of the natural gas industry is not as expected and the EPC business is not as expected.