Event: The company announced its 2017 semi-annual report. Performance and operating income increased 23.29% year on year, and net profit of the mother increased 28.07% year on year. Sales revenue for the second quarter was 180 million yuan for automotive lubricants, 14.1422 million yuan for industrial lubricants, 3,946,700 yuan for antifreeze, and 5.8545 million yuan for automobile maintenance products. Comment: The company's performance in the first half of the year increased significantly. Revenue increased 23.29% year on year to 487 million yuan, and net profit increased 28.07% year on year to 754.58 million yuan. The increase in revenue and net profit was mainly due to the increase in the sales performance of the company's lubricants business. Compared with the first quarter, there was a marked decline in the second quarter results, with revenue and net profit falling 28.12% and 42.97%, respectively. The company's basic earnings per share were 0.38 yuan/share. The basic earnings per share for the same period last year were 0.34 yuan/share after dilution, an increase of 11.76% over the previous year. The company's overall gross margin for the first half of the year reached 34.42%, down 1.91 percentage points from the same period last year. The reason may be that crude oil prices in the first half of the year rose sharply compared to the same period last year, causing the prices of raw base oils and additives purchased by the company to rise by 5.91% and 2.62% respectively, which had a certain impact on the company's gross margin. The company's fee rate for the first half of the year was 12.01%, down 4.79% from the same period last year. In the first half of the year, the company's three fees overall decreased by 11.88% compared to the same period last year, mainly due to a sharp reduction in financial expenses of 275.79% due to an increase in interest income, and a 21.59% reduction in management expenses due to the relocation of R&D centers and a reduction in R&D investment by 21.59%. Sales expenses increased slightly by 3.19%, mainly due to the company's increased advertising investment. The new Huangdao plant for the company's fund-raising project has met the equipment commissioning conditions, and production capacity will be officially put into operation in the second half of the year. After delivery, the project can produce 80,000 tons of lubricant, 20,000 tons of antifreeze, and 1,000 tons of brake fluid per year. Furthermore, the Huangdao R&D center will also be put into use in the second half of the year, and the company's R&D, testing, and quality control capabilities will be further improved. The company is the first listed lubricant company in China. With the continuous increase in the share of automotive lubricants in the lubricants market, the gradual increase in the share of middle and high-end lubricants, and the company's strong investment in brand promotion, we are optimistic that the penetration rate of the company's automotive lubricants business will increase. We expect the company's 2017-2019 EPS to be 0.78, 0.97, and 1.10 yuan/share, corresponding to PE of 33.62, 27.09, and 23.85, respectively, with purchase ratings of 33.62, 27.09, and 23.85. Risk warning: The price of raw materials has risen, and the penetration rate of automotive lubricants has not met expectations.