Incident: The company released its 2018 semi-annual performance forecast. It is expected to achieve net profit of 308-370 million yuan from January to June 2018, compared to 237 million yuan for the same period last year, an increase of 30.08%-56.26% over the previous year. Comment: The business of the garden and automobile sector is improving, and the performance forecast has risen sharply: the company's business in the garden and automobile sector improved during the reporting period. At the same time, due to increased performance due to irregular profit and loss, the interim report forecast was a sharp increase over the same period last year. Specifically, the garden sector closely follows the rapid development of the market. Newly signed projects continue to be implemented and sales revenue is growing steadily. The perfect industrial ecological chain and experienced design and construction team fully guarantee the continuous and efficient operation of the business; the auto parts sector has increased the market share of non-tire environmentally friendly rubber products, customer structure optimization, and product upgrades have increased the company's operating income; the impact of non-recurring profit and loss on the company's net profit is expected to be 65 million yuan to 66 million yuan, mainly due to the overall urban planning of the auto parts sector. To you. Adequate on-hand orders ensure high performance growth: The company has sufficient orders in hand. In the first quarter of this year, the company's wholly-owned subsidiary in the garden sector signed an order amount of 115 million yuan for new competition garden projects, and won 341 million yuan of unsigned orders. The company has signed a total of 5.421 billion yuan of unfinished orders, including 5.335 billion yuan for engineering orders and 86 million yuan for design orders. Corresponding to last year's revenue of 2,626 billion yuan in the garden sector, the order revenue guarantee ratio is more than double. The company has sufficient orders in hand, and the future performance is high and full of momentum for growth. Plans to invest abroad to acquire shares and further expand the garden business: The company negotiated with shareholders of a garden engineering company on June 23 and reached a relevant agreement to acquire the shares of the garden engineering company held by the counterparty. The target company is an enterprise with grade A landscape design qualification and one of the most powerful landscaping enterprises in China. It has many classic success stories in design and construction. Past performance and the brand established over the years will help the company expand its business. At the same time, the project covers regions such as South China, East China, North China, Northeast China and Southwest China, and has a strong level of market development, management capabilities and good brand advantages, which will also help the company expand its business. Financial forecasting and valuation: The company is expected to achieve net profit of 8.79/12.30/1,659 million yuan from 2018 to 2020, an increase of 44.3%/39.9%/34.8% year-on-year, corresponding EPS of 1.09/1.52/2.05 yuan. The current stock price is 6.2/4.5/3.3 times PE from 2018 to 2020, maintaining the “Highly Recommended” rating. Risk warning: PPP business model risk, epitaxial expansion risk, repayment risk, etc.