The predecessor of Rainbow Essence: With chemistry as the root. Judging from the development of the chemical industry in recent years, chemical products maintained rapid growth from 2011 to 2013, from 8.19% to 24%. Revenue increased from 5.7% to 23.6% year over year. Judging from the revenue share of various products, environmentally friendly functional coatings and accessories have always accounted for more than 50% of the main business revenue, followed by automobile environmentally friendly and energy-saving beauty care products, which account for 20%. After 2014, due to the slowdown in macroeconomic growth, the overall growth rate of the chemical industry also slowed. As a result, the company's traditional chemical businesses were challenged to a certain extent. To this end, while maintaining the upgrading of the traditional chemical business, the company began to transform and upgrade and enter the new energy industry. The present world of Rainbow Precision: Using new energy as an opportunity to start a second business. We believe that the rapid development of the new energy (photovoltaic, etc.) industry has benefited from two factors: first, the law of energy evolution — the law of declining marginal revenue from traditional resources, which accelerates the replacement of new energy (photovoltaics, etc.); second, policy release+technological advance+environmental improvements help the development of the photovoltaic industry, which is an external force. Therefore, time and place benefit people and promote the development of the new energy (photovoltaic) industry. From the perspective of new energy (photovoltaics), the country's strategic layout for the photovoltaic industry is obvious, and the photovoltaic industry is showing a trend of great development. In this context, the company reviews the current situation and accelerates the transformation and upgrading of traditional businesses. In 2014, Shenzhen Yongsheng New Energy Co., Ltd. was established to specialize in the expansion of photovoltaic new energy business. In 2016, 400MW is expected to be connected to the grid. The power plants are located in central and eastern regions such as Anhui and Zhejiang. There is no problem with light abandonment and electricity restrictions, and profits are guaranteed. Currently, the gross profit is over 65%. The future layout of photovoltaic power plants will be carried out in conjunction with integrated photovoltaic storage and charging. The chemical and new energy business structure is expected to change from 9:1 to a 5:5 business structure in 2016, and the new energy business will become the company's main business. In 2016, in addition to actively deploying photovoltaic power plants, the company also further laid out new energy vehicles, energy storage, charging stations and energy Internet services. It was reborn, and a new rainbow was born! The future of rainbow refinement: reincarnation, implementation of the “four comprehensive” strategies. During the “13th Five-Year Plan” period, in addition to actively deploying photovoltaic power plants, the company will further deploy new energy vehicles, energy storage, charging stations, and energy Internet services. It will be reborn, and a new rainbow will be born! Energy storage: Acquire Beijing Baineng to enter energy storage. The energy storage policy continues to advance and is poised to go. 2016 will be the most outstanding performance in the field of energy storage. In March, the company announced that the company plans to use its own capital of RMB 8 million to acquire Feiran Venture Capital to hold all of Beijing Baineng's shares, or 8% of the shares. After the above equity transaction is completed, the company will increase the capital to Beijing Baineng by RMB 79.75 million and subscribe to 55.25 million shares of Beijing Baineng. After the above share transfer and capital increase, the company holds 51.078% of Beijing Baineng's shares. Beijing Baineng's business is located in the fields of energy storage photovoltaic power plants, smart microgrids, energy storage power banks, new energy vehicle charging stations, and intelligent operation and maintenance of photovoltaic power plants. At the same time, it is stipulated that the net profit of Beijing Baineng in 2016-2018 is promised to reach 2000, 40, and 60 million yuan. In the field of energy storage photovoltaic power plants, the model of an energy storage power bank is used to improve the economic efficiency of power plants and achieve applications such as smoothing photovoltaic power generation, cutting peaks and filling valleys; in the field of charging stations for new energy vehicles, Beijing Baineng and China Highway Engineering Consulting Group Co., Ltd., a wholly-owned subsidiary of China Communications Construction Co., Ltd., signed a “strategic cooperation agreement on electric vehicle charging stations” in major regions and road networks across the country. The two sides plan to establish a “four vertical, two horizontal and three rings” of intercity charging stations; the two sides plan to establish a “four vertical, two horizontal and three rings” of intercity charging stations; One of the mainstream energy storage technologies. Beijing Baineng has large-scale production capacity for key materials for zinc-bromine batteries. It has built a production line for key battery materials and battery components, including diaphragms, electrodes, electrolytes, etc., and has mastered the material formulation and production process. The production cost has been reduced to one-third of similar international products; it has the ability to integrate battery production and systems. Beijing Baineng has set short, medium and long-term development goals for itself. Through strategic layout, it has seized market resources, acquired, and absorbed energy storage technology, and realized commercialization and large-scale development of energy storage technology. New Rainbow: integrated service provider for optical storage and charging. On June 13, the company issued the “Notice on Foreign Investment and Establishment of Wholly-owned Subsidiaries” stating that the company used its own capital to set up wholly-owned subsidiaries in 15 regions including Beijing, Shanghai, Tianjin, Chongqing, Guangzhou, Shenzhen, Zhengzhou, Jingdezhen, Xianning, Wuxi, Dongguan, Huizhou, Shantou, Chaozhou, and Qinghai Lake to promote the integration of the company's optical storage and charging. Through mergers and acquisitions, the company has acquired 100% of the shares of Huzhou Jingsheng Photovoltaic Technology Co., Ltd., 100% of the shares of Ningxia Jieyang Zhongyuan Electric Power Co., Ltd., and 100% of the shares of Xinyu Deyou Solar Power Co., Ltd. to continuously expand the new energy industry and technology fields and build a new energy industry system at the forefront of the country. This year, the company will strive to achieve the goal of deploying 100 charging and switching stations nationwide in 2016. To this end, it will support the development of the three major industries of “New Energy Internet+Energy Storage”, “New Energy Vehicle Platform+Operation”, and “Energy Internet+Finance”. During the 13th Five-Year Plan period, the company will adopt the “Four Comprehensive” strategic plans to enhance the efficiency and efficiency of financial innovation, investment and financing, accelerate mergers and acquisitions or cooperation on energy storage and new energy vehicle Internet platforms, build the company into an enterprise showing advantages in the environmental protection, energy efficiency, new materials and new energy industries, and build the Internet+smart energy+green travel into a leading enterprise in the new energy industry and an outstanding listed company with the start of the country's “13th Five-Year Plan”. Profit forecast. As the photovoltaic industry, energy storage and new energy vehicles enter the fast track, the company's various businesses are in a period of rapid performance release. We expect that under the gradual implementation of the 13th Five-Year Plan for National Photovoltaics, New Energy Vehicles and Energy Internet, the company's EPS from 2016 to 2017 will be 0.46 and 0.91 yuan respectively, and the corresponding PE will be 75X and 38X. We give a “buy” rating.