This report is read as follows:

Due to the lower-than-expected growth rate of the company's quarterly results in 2018 or due to the prudent operation of the company in the context of a tight financing environment, the company has more orders on hand and still needs to wait for the financing environment to improve its future performance expectations.

Main points of investment:

The rating was downgraded to "cautiously overweight". The revenue from January to September in 2018 increased by 2.126 billion / 10.12%, and the return net profit by 193 million / 11.37% was lower than expected, so the EPS in 2018 / 19 was lowered to 0.52 PE (1.06 yuan after dilution). Due to the lower-than-expected performance of the downside stack company in the construction sector, the target price was lowered to 7.20 yuan (15.51 yuan), corresponding to about 14 times of PE in 2018, cautiously increasing its holdings.

Q3 performance negative growth, gross / net interest rate stable, operating net cash flow deteriorated. During the reporting period, 1) the growth rate of Q1~Q3 revenue was 43.41%, 12.17%, 4.48%, 48.61%, 22.80%, 9.63%, 12.17%, 4.48%, 22.80%, 12.17%, 4.48%, 22.80%, 9.63%, 9.63%, 12.17%, 4.48%, 48.61%, 22.80%, 9.63%, 12.17%, 4.48%, 48.61%, 22.80%, 9.63%, 12.17%, 4.48%, 48.61%, 22.80%, 22.80%, 9.63%, 12.17%, 4.48% and 22.80%, respectively. 3) the operating net cash flow is-475 million (- 162 million in the same period in 2017) the year-on-year deterioration is mainly due to a sharp decrease in the cash-to-cash ratio (44.78%/-23.28pct); 4) the asset-liability ratio is mainly due to the completion of the rights issue at the beginning of the year, resulting in an impairment loss of 18 million / + 43.49%. 5) forecast a growth rate of 0. 30% in 2018.

Q3 quarter newly signed orders nearly doubled compared with the same period last year, waiting for the financing environment to improve performance expectations. 1) New contract orders signed by Q1~Q3 in 2018 were 1.77 billion, 1.71 billion, and the growth rate of new orders in Q3 was 97% compared with the same period last year. At the end of the Q3 quarter of 2018, the company has signed unfinished orders by 6.81 billion / a year-on-year increase of 69%, and the existing orders are abundant. 2) by the end of September 2018, the company had accumulated 6.5517 million shares / about 1.28% of the total share capital, with a total amount of about 46 million yuan. 3) financing has become the core variable of PPP/EPC project promotion under the current environment, and the ecological garden sector where the company is located still needs to wait for the financing environment to improve in order to improve the project implementation progress and performance expectations.

Catalysts: infrastructure investment stabilized and rebounded, eco-environmental protection policies increased, interest rates gradually downward, and so on.

Risk tips: interest rates continue to rise sharply, infrastructure investment falls sharply, PPP continues to rectify, and so on.