Incidentally, Tianyin Electromechanical released its 2017 annual report. It achieved full-year operating income of 773 million yuan, an increase of 18.10% over the previous year, and realized net profit of 191 million yuan, an increase of 15.30% over the previous year. At the same time, the company released a performance forecast for the first quarter of 2018. Net profit for the first quarter is expected to decrease by 10%-20% year on year. The increase in performance was in line with expectations. The military and civilian business developed steadily in 2017, the company's operating income was 773 million yuan, an increase of 18.10% over the previous year; realized total profit of 219 million yuan, an increase of 12.33% over the previous year; and realized net profit attributable to shareholders of the parent company was 191 million yuan, an increase of 15.30% over the previous year. Based on 432 million shares, the company distributes cash of 1.50 yuan (tax included) to shareholders for every 10 shares. The company has achieved stable development of refrigerator compressor spare parts and military electronics business. The share of military electronics has steadily increased. Newly developed products have been recognized by the market. The company's military electronics business achieved operating income of 148 million yuan, an increase of 36.54% over the previous year, and realized net profit of 59 million yuan, an increase of 43.69% over the previous year, accounting for 30.90% of the company's net profit. The share of the military industry business continued to grow. The acquisition of Leixin from the University of Technology has expanded the radar machine business with a new system. New products such as high-speed signal processors and avionics modules have been recognized by customers, and are expected to become new growth points in the future. The Shenzhou Airlines acquisition plan was terminated due to failure to reach an agreement with the acquirer. The company's performance in the first quarter of 2018 declined year-on-year, mainly due to delays in delivery of some military orders. However, the company's current military orders exceeded 100 million, an increase of 54.81% over the previous year. We believe that with the gradual implementation of military reform, national defense, and military informatization, the company's military electronics business will continue to grow rapidly. The refrigerator compressor spare parts business has maintained steady growth, and the inverter controller business has become a new highlight. The revenue of refrigerator compressor spare parts was 625 million yuan, an increase of 14.43% over the previous year. Among them, the sales revenue of the inverter controller accounted for 24.13% of the spare parts business revenue, an increase of 71.26% over the previous year, and the construction of new inverter controller production capacity has been completed. The company is increasing the intelligent transformation of the original product line, and costs will continue to be reduced in the future. The profit forecast predicts that the main business revenue for 2018-2020 will be 920 million yuan, 11.04 billion yuan, and 1,325 million yuan respectively, and net profit will be 222, 2.79 and 337 million yuan respectively, and achieve EPS of 0.52, 0.65, and 0.78 yuan respectively. Corresponding PE is 27, 22, and 18 times, respectively. Tianyin Electromechanical was given an “increase in holdings” rating. Risk warning: Policy implementation falls short of expectations, and market expansion of new products is slowing down.