Core view Suli Co., Ltd. focuses on the production of biocides and environmentally friendly flame retardants. The company with excellent financial conditions is a leading manufacturer of biocides and environmentally friendly flame retardants. It has a design capacity of 29,600 tons of pesticides and pesticide intermediates (pyrimidine, pesticide formulations, etc.), 12000 tons of flame retardants and flame retardant intermediates (decabromodiphenyl ethane, etc.), and 14,000 tons of other fine chemical products. The compounded annualized growth rate of the company's net profit from 2011-17 was 36%; gross margin and net margin continued to rise over the years and were significantly higher than those of peers; the company had good cost control, excellent cash flow, and continued to decline in balance ratio during the period. Fungicides: The industry is booming, and the price of the original drug continues to rise, driving profitability to continue to increase, and global demand is growing steadily; on the supply side, due to high process barriers, the supply pattern is concentrated, and there are only 3-4 large-scale domestic manufacturers; the price of probiotics has risen from 36,750 yuan/ton in the same period last year to 53,000 yuan/ton at present, an increase of 44%. Pyrimethoxylate is the most sold methoxyacrylate disinfectant in the world and is known as the “king of biocides”; domestic pyrimidine drug prices have also experienced two rounds of rise in the 2017 Q4 and 2018 Q3, and have now risen to a four-year high of 380,000 yuan/ton, an increase of more than 50% compared with the same period last year. Prices of biocides are rising, driving the company's profitability to continue to increase rapidly. Flame retardants: The breadth and depth of domestic use is seriously lagging behind, and there is room for growth in demand, decabromobiphenyl ethane is a new generation of environmentally friendly brominated flame retardants; the development of China's flame retardant industry started late, and there is plenty of room for use in the breadth and depth of use; the price of the company's flame retardant products is also rising sharply, and the cost side prices are stable, and gross margin is expected to rise. The 1,500-ton melamine polyphosphate and 10,000-ton compound masterbatch projects will also be completed and put into operation within the year, and the flame retardant product line will continue to expand. For the first time, companies with an “increase in holdings” rating were small and beautiful, high-quality enterprises in the pesticide segment, fully benefiting from the increase in profits brought about by rising prices of bactericides such as probiotics; the fund-raising project will be intensively produced this year and next two years, and endogenous growth momentum is strong. The estimated revenue for 2018-2020 will be 1,691 billion, 21.23 billion yuan, 2,516 billion yuan, EPS is 1.65, 2.00, 2.31 yuan/share, and corresponding PE is 12.9X, 10.6X, and 9.2X. The first coverage was given an “plus” rating. Risk warning: Product development progress falls short of expectations; product certification cycle exceeds expectations, etc.