Revenue grew rapidly, and performance was in line with expectations. On April 24, 2018, the company announced its annual report. In 2017, it achieved revenue of 272 million yuan, an increase of 32.66% over the previous year; realized net profit of 7.085 million yuan, turning a loss into a profit; and the performance was in line with expectations. We believe that the main reason for the rapid increase in operating income is that the company signed new orders and sales in 2017 increased significantly compared to the same period last year. The press business remained steady, and the lightweight business became a future performance growth point. The company's machinery and equipment business achieved sales revenue of 117 million yuan, an increase of 77.27% over the previous year. Among them, revenue from presses and complete line equipment was 87.352 million yuan, and gross margin was 21.65%, up 10.6 percentage points from the same period last year. The press business is the company's traditional dominant business. Through resource reintegration and strategic adjustments in recent years, the business achieved obvious results in 2017. The company's large-scale equipment was successfully exported to North America and Western Europe, laying a solid foundation for the company's high-end machinery and equipment to enter mainstream European and American international markets. The company's composite lightweight products business achieved sales revenue of 142 million yuan, an increase of 15.87% over the previous year, accounting for 52.08% of annual revenue, gross margin of 34.73%, an increase of 3.71 percentage points over the same period last year. The automotive lightweight business is the focus of future development, and the company has advantages in composite material equipment and process technology. Batch supply cooperation agreements have been reached with customers such as Geely, Ningde Shidai, BMW Brilliance, Yutong, and Dongfeng Liuqi, etc., and many projects have entered the batch supply stage. Linking automakers to create a win-win pattern of cooperation and entering the supply chain between Geely and CATL can be expected to grow. The company's carbon fiber and glass fiber composites can be used for automotive exterior parts, structural parts, battery covers, etc. We believe that by linking large car companies, it will help achieve rapid product release. Among them, Haiyuan and Geely recently signed a strategic cooperation agreement for comprehensive cooperation in the field of automobile lightweighting. Geely is the first private car company in China. It has become a leading independent passenger car brand, and its production and sales volume rank among the highest in the entire industry. We believe that the strategic cooperation between the company and Geely will achieve a win-win pattern of cooperation between the two sides; at the same time, according to the company announcement on December 22, 2017, the Geely MPC-1 project is about to enter the mass production stage. According to the company announcement, Haiyuan has received instructions for the Geely MPC-1 project, and will gradually move into the testing and mass production stage later. The model is expected to be launched in batches within 2018, with sales revenue of 450 million yuan during the life cycle. Enter the battery cover supply chain of the Ningde Era. Ningde Times is committed to global green energy applications, provides efficient energy storage solutions, establishes a whole industry chain in the field of power and energy storage batteries, and has core technology. Currently, Ningde is undergoing a comprehensive replacement of battery cover composites, yet Haiyuan is one of the few domestic enterprises that have mastered carbon fiber composite production line technology. Ningde Times and Haiyuan will cooperate deeply in the field of battery covers. According to the company announcement on December 30, 2017, the Ningde Times battery box cover project is expected to enter the mass production stage in 2018, and is expected to achieve a total sales revenue of 150 million yuan during the life cycle. Profit forecast: We expect the company's net profit in 2018-2020 to be 90 million yuan, 180 million yuan, and 346 million yuan respectively, corresponding to EPS of 0.35 yuan, 0.69 yuan, and 1.33 yuan, respectively. Currently, we are optimistic about the company's future development prospects in the automotive and lightweight construction sector. The target price for 6 months is 20.7 yuan, giving it a “buy” rating. Risk warning: There is a possibility that the implementation of matters covered by future strategic cooperation agreements will change; the trend of automobile weight reduction falls short of expectations.