Incident: In December 2018, the company completed the issuance of the fifth issue of ultra-short-term financing notes in 2018 and announced the relevant situation. The bond listing transaction date is December 13, 2018, the maturity date is June 10, 2019, the bond maturity is 180 days, the planned issuance volume is 500 million yuan, the actual issuance volume is 500 million yuan, and the coupon interest rate is 6.2%. Comment: The issuance of Ultra Short Finance was successfully completed in full, and the coupon interest rate was reasonable, relieving some of the company's financial pressure. In the second half of 2018, bond market transactions were deserted. By the fourth quarter, bond market transactions had picked up somewhat. The company's ultra-short loan issuance was successfully completed in full, and the coupon interest rate of 6.2% is also within a reasonable range. According to statistics, from December 2018 to March 2019, the company had 1.5 billion, 1.5 billion, 500 million, and 1.5 billion dollars each month, respectively. A total of 5 billion yuan had just been repaid. The completion of the 500 million ultra-short loan issuance will ease some of the company's financial pressure, but the repayment pressure in the first quarter of 2019 is still high, and the company will continue to focus on capital raising in the future. Integrated sanitation performance orders are growing rapidly. It is expected to achieve revenue of 4 billion dollars in 2018, and sanitation revenue is still expected to double in 2019. The company added 60 new operation contracts for integrated urban and rural sanitation business in 2018H1, with a total annualized contract amount of 1,356 billion dollars and a total contract amount of 10.885 billion yuan, maintaining high growth. From 2014 to 2018 H1, the company has executed a total of about 500 sanitation service contracts, with a total annualized contract amount of 2.67 billion yuan, and a total contract amount of 36.502 billion yuan during the project operation period. The sanitation business is expected to achieve revenue of about 4 billion yuan in 2018, and is expected to double to 8 billion yuan in revenue in 2019, corresponding to a net profit of about 400 million yuan. Using project financiability to expand high-quality PPP projects, a large number of PPP orders were signed mainly in the first half of the year. The number of new PPP orders declined markedly in the second half of the year, and the traditional solid waste business developed steadily. In the first half of 2018, the company signed contracts for medical waste disposal projects such as Wuming in Nanning, Chuxiong Restaurant, and Debang Suzhou, and Debang in Suzhou, and won new bids for various PPP projects such as Xi'an, Shaanxi, Dongyuan County, Tongchuan City, and Shilou County. The above projects involved an investment of nearly 8.2 billion yuan, and PPP project orders grew rapidly. At the same time, according to changes in market conditions, the company placed project financeability first to obtain high-quality PPP orders, and the number of new PPP orders declined markedly in the second half of the year. Currently, the total number of PPP orders in hand is about 45 billion yuan, of which actual orders are about 8 billion yuan, which still has strong support for the 2018 performance. It is estimated that the full year of 2018 will achieve project revenue of about 3 billion yuan. In the long run, the company's share of project revenue will be lower and lower. Renewable resources are being deployed at an accelerated pace, and innovative models are changing the single profit model. In 2018, the company's renewable resources business continued to accelerate, and the scale effect gradually formed, and the competitive pattern improved markedly. At the same time, the company actively carried out electronic waste non-fund business, changed the original single profit model that relied on fund subsidies. In the first half of 2018, a total of 11,670 tons of hazardous waste and medical waste were disposed of, further promoted automobile dismantling, parts recycling and lithium battery recycling business. At the same time, the government fund budget allocated about 3.6 billion yuan in 2018, the Ministry of Ecology and Environment announced a year-on-year increase of about 3.6 billion yuan, an increase of 2,765 billion yuan, and the increase in the subsidy budget was conducive to improving industry cash flow. The company '17 Accounts receivable are 38.6, of which about 1.99 billion yuan is subsidy funds for waste electrical and electronic products. Subsequent cash flow is expected to improve after the subsidy is withdrawn. Business direction and profit forecast: Judging from future development, although the company currently has a large number of PPP orders, the long-term business focus will be on operational projects, and the sanitation operation business will still be in a rapid growth channel that has doubled. As the scale continues to expand, there is still a possibility that future profitability will improve; there is huge space in the renewable resources sector, and the company has completed its initial layout. The company's imputed net profit for 2018 and 2019 is estimated to be 1.35 billion yuan and 1.6 billion yuan. The current market value is only 11 times the PE valuation corresponding to 2018, and the PE valuation corresponding to 2019 is only 9.3 times. If calculated based on 15 times the PE valuation in 2018, the company's target market value for 2018 is 20 billion yuan, corresponding to the target price of 14.0 yuan, maintaining the “Prudent Recommendation - A” rating. Risk warning: PPP orders and sanitation projects fall short of expectations; precious metals prices are low, and there is a risk that payments have just been made.