Incident: On April 9, Xiongdi Technology released its performance forecast for the first quarter of '19. It is expected to achieve net profit of 9 million yuan to 10 million yuan in the first quarter, a significant increase over the loss of 3.5877 million yuan in the same period last year. Comment: Rapid growth in the first quarter. The company released a performance forecast for the first quarter of '19. It is expected to achieve net profit of 9 million yuan to 10 million yuan in the first quarter, a significant increase over the loss of 3.587,700 yuan in the same period last year. The results show that the company's overall operations are good and that it has achieved rapid growth. The company is steadily promoting various types of business in accordance with the annual business plan. The company focuses on innovative businesses in the fields of identity technology such as smart livelihood policing, digital identity, intelligent public transportation, and online license management, and is increasing R&D investment and market expansion efforts. The company is also promoting market development in the fields of public security and foreign affairs, transportation and aviation, social security finance, overseas documents, and elections in an orderly manner. During the reporting period, the company expects its main business revenue to increase by more than 60% compared to the same period last year, leading to a significant increase in profits. The company's overall market demand continues to expand, and the company's business maintains sufficient growth momentum and development space. Security card leader, multiple businesses go hand in hand. The company is a domestic professional card overall solution provider. It is one of the few enterprises in the world that has mastered the electronic passport production and issuance technology system. The company has broken the monopoly of foreign companies in the Chinese market, has China's own brand advantage in the field of security cards, is technologically advanced, and has obvious core competitiveness. The company has successively provided a full range of services for card/local passports such as second-generation ID cards, electronic passports, social security cards, etc., including certification systems, full certification equipment, and personal certification centers. The service targets include the Ministry of Public Security and the Ministry of Foreign Affairs. Currently, on the basis of the traditional business of ID cards and passport issuing equipment, the company has spawned multiple businesses: the online electronic passport management system is mainly used in the passport management field of the Party, government, military, foreign affairs departments, enterprises and institutions to solve problems such as inefficient manual passport management. The company has promoted this business in the fields of airlines, banks and other fields since '17, and has achieved good results. Currently, the company is continuously optimizing product design and solutions to quickly open up the market; in terms of overseas business, the company has accumulated a C package of Hong Kong's next-generation intelligent ID card system and passes for Hong Kong and Macao residents to and from the Mainland. There are a number of projects such as the “Hong Kong Homecoming Certificate Self-Service Collection System”, Belarusian electronic information, and the Nigerian election system. At the same time, 2019 is the Nigerian election year, and related demand is expected to explode further. In addition, in the field of cards related to cards, the company is expanding its business into non-public security fields such as finance and social security. Related products and solutions include smart livelihood policing (household administration, immigration, traffic police) solutions, smart social security office hall solutions, and self-service acceptance systems at smart banking outlets. The above businesses will strongly guarantee the company's future growth. Smart bus travel solutions have obvious advantages, and companies are expected to reposition themselves. In the public transportation (bus+rail) industry, the company provides an overall microelectronic payment solution integrating various forms of online and offline payments. The company's payment acceptance terminals and solutions have covered more than 100 cities across the country, including Shenzhen, Chongqing, and Nanchang. Based on this, the company continues to expand its business areas, expand and integrate bus data portals such as intelligent dispatch and monitoring systems, passenger flow analysis systems, and bus peripheral management, and gradually build intelligent bus solutions and decision analysis systems with smart bus clouds as the core platform and supported by four major system platforms: micropayment, intelligent scheduling, passenger flow analysis, and operation services. The development of mobile internet has promoted the rapid promotion of mobile payment methods such as QR codes and mobile phone NFC in the field of public transportation. Electronic payment acceptance terminals are integrating various payment methods such as smart cards, QR codes, and mobile NFC, and become an important operating port for public transportation big data acquisition and a core node for online and offline integration. Based on rich industry experience and customer and channel resources, the company has joined hands with Ali and Tencent to combine the company's overall solution capabilities and customer resource advantages with the platform advantages of Internet companies to jointly create a new path for the development of public transportation mobile payments The company's identification business is migrating from offline to online, speeding up the company's planning, layout, and development of offline and online identity management interconnection and online trusted identity authentication services, and gradually transforming from a hardware supplier to a service provider. Investment advice: Considering the company's outstanding card position advantages, the company is expected to achieve net profit of 1.08, 150, and 20 million yuan in 2018-2020. The valuation corresponding to the current market value is 38, 27, and 20 times, giving it a “highly recommended” rating. Risk warning: The strategic development process falls short of expectations; the development of industry customers falls short of expectations; progress in technology development falls short of expectations; overseas business development results fall short of expectations.