Investment highlights: Events/News: The company released a quarterly report. Q1 achieved operating income of 1,245 billion yuan, up 6.99% year on year; net profit to mother of 171 million yuan, up 59.08% year on year; finally achieved basic earnings per share of 0.056 yuan, weighted average ROE of 1.59%, an increase of 0.55 percentage points year on year. The results were basically in line with expectations. Strong growth in metal ores and coal led to a 6.49% year-on-year increase in throughput. The company completed a cargo throughput of 60.23 million tons, an increase of 6.49% over the previous year. In terms of major commodity categories, the largest share of metal ore, coal, products, and timber throughput was 37.97 million, 10.2 million, and 5.34 million tons, respectively, up 7.35%, 29.59%, and 13.48% year-on-year, respectively; the throughput of completed food, steel and non-metallic minerals was 2.97 million, 1.22 million, and 540,000 tons, down 16.7%, and 13.5%, respectively. Looking at the classification of domestic and foreign trade goods, the completed foreign trade cargo throughput was 49.52 million tons, an increase of 6.66% over the previous year; the completed domestic trade cargo throughput was 10.7 million tons, an increase of 5.71% over the previous year. With the gradual expansion of the watt-day line, coal throughput is expected to continue to increase. The Wari Line crosses the three provinces of Jinyu and Lu, connecting several major railway lines from north to south. As the capacity of the Daqin and Shuohuang Lines is tight, the Wari Line is expected to continue to increase as demand for coal transportation from west to east increases. Since January of this year, the coal transportation line to Rizhao Port has been normalized. The volume of coal arriving at the port has increased dramatically. The Q1 coal train is 173, with a traffic volume of 1.56 million tons. It is expected to reach 4 million tons throughout the year, which will lead to a major increase in coal throughput. Also, from a long-term perspective, iron ore from Sheung Shui is expected to be transported to steel companies in the central and western regions through the Wari Line, and there is huge room for loading on the two-way heavy rail on the Wari Line. The Shangang Steel boutique base was successfully put into operation, and iron ore grew steadily. The construction of the Shandong Iron and Steel boutique base is progressing steadily. The first phase was completed and put into operation in '17, with an initial production capacity of 4.5 million tons, which is expected to increase the company's throughput by 10 million tons. At the same time, the corresponding supporting ore terminal project is progressing smoothly. Nine caissons have been installed, and a 100,000 square meter yard has been built, and the ore transportation system in the Lanshan Port area has been completed. Continued construction and commissioning of the Shangang Steel boutique base will drive a steady increase in the throughput of Shangshui metal ore and Shangshui coking coal, and build room for performance growth. Depreciation of fixed assets is extended, and valuation pullbacks establish a margin of safety. Considering that port equipment is better maintained and wear and tear is lower, starting at the beginning of this year, the company adopted future applicable laws to extend the depreciation period for some categories of fixed assets. The company initially estimates that this change in accounting estimates will increase the total profit for the year by about 227 million yuan, accounting for 37.82% of the total profit for 2017. This estimate change will improve the company's book profit level, reduce the valuation to less than 20 times, and establish a margin of safety. Maintain profit forecasts and maintain an “gain” rating. We maintain our profit forecast. The net profit from 2018 to 2020 is estimated to be 613 million yuan, 679 million yuan, and 779 million yuan, respectively, corresponding to 19 times, 17 times, and 15 times the current share price PE, respectively. Maintain an “Overweight” rating. Risk warning: Cargo throughput falls short of expectations.