Matters: The company released its report for the third quarter of 2018. The company achieved revenue of 465 million yuan in the first three quarters, an increase of 36.66% over the previous year; and realized net profit attributable to shareholders of listed companies of 73 million yuan, an increase of 42.18% over the previous year. Among them, the third quarter achieved quarterly revenue of 140 million yuan, an increase of 1.62% over the previous year, and realized net profit of 121 million yuan, an increase of 4.47% over the previous year. Comment: The growth rate of electronic assembly equipment is good, and optoelectronic module equipment has begun a new growth point in performance. The company achieved revenue of 465 million yuan in the first three quarters of 2018, an increase of 36.66% over the previous year. The company's sales revenue for electronic assembly equipment increased significantly compared to the same period last year, and some special equipment for optoelectronic modules achieved large-scale sales and began to be put on the market. The gross margin for the first three quarters declined year-on-year, and the comprehensive expense ratio decreased slightly. During the reporting period, the company achieved a gross profit margin of 38.49%, a decrease of 4.46 percentage points compared with the same period last year. The overall expense ratio for the first three quarters of 2018 was 21.63%, down 3.5 percentage points year on year. Among them, the sales expense ratio was 10.44%, down 2.9 percentage points year on year; management fee rate was 11.56%, up 0.1 percentage points year on year; and financial expense ratio was -0.37%, down 0.8 percentage points year on year. The optoelectronic module equipment business is beginning to show results, and the diversified layout enhances the company's value. The company's traditional electronic assembly equipment is in a leading position in the industry, with a market share of 30%. The main products include electronic welding equipment and intelligent machine vision inspection equipment. After years of hard work, the company has a good customer base. The main customers include Foxconn subsidiaries, Flextronics, Lansi Technology, Gree Electric, Huawei, and Midea Group. In the emerging business of optoelectronic modules, with the popularity and popularity of full-screen mobile phones, the company has successfully entered the market through the development of under-screen fingerprint module devices. Customers include first-class manufacturers such as Foxconn, VIVO, Ophite, and Flextronics, and has established long-term strategic partnerships with OFIG, which is expected to become the company's main performance growth point in the future. As the concentration of the industrial structure increases, downstream consumer electronics technology changes, and the penetration rate of full-screen mobile phones increases, the company is developing new businesses while stabilizing its position in the electronic assembly equipment industry. It is expected that in the future, cyclical fluctuations will be smoothed out and performance will continue to grow steadily. Profit forecast and investment rating: The prosperity of the SMT industry fell short of expectations. We lowered the company's performance forecast to a net profit of 0.93/1.12/136 million yuan in 18-20 (original forecast value of 1.27/1.75/225 million yuan), corresponding to EPS of 0.38/0.46/0.56 yuan (original forecast value of 0.52/0.72/0.92 yuan), corresponding to PE 45/37/30 times. Be optimistic that the development of new products will bring new profit growth points and maintain the “recommended” rating. Risk warning: Downstream development falls short of expectations, and the risk of consumer electronics technology upgrading.