The performance fell short of expectations that Guannong Co., Ltd. achieved operating income of 1.15 billion yuan in 2014, down 10% from the previous year. Net profit was 160 million yuan, down 45% year on year, or 0.41 yuan per share (fully diluted), lower than our expectations of 0.95. The company achieved investment income of 230 million yuan in Luo Potassium, a year-on-year decrease of 25%. In 2014, the company plans to increase 10 shares for every 10 shares and distribute a cash dividend of 2 yuan. The development trend is increasing demand for sulfur-based compound fertilizers, which is beneficial to the company. Since the first half of last year, the market demand for sulfur-based compound fertilizer has expanded, and the company, as the fertilizer company with the largest potassium sulfate production capacity in China, will benefit from the improvement in downstream demand. Potassium sulphate production capacity is being invested in large quantities, and prices may be under pressure. The price of potassium sulfate reached a record high last year, leading to the release of more than 1 million tons of potassium chloride to potassium sulfate production capacity using the Mannheim method at the end of the year, which may put pressure on the price of potassium sulfate this year. SDIC Luo Potassium plans to expand production by 300,000 tons to improve economic efficiency. Potassium Luo plans to add 300,000 tons of production capacity to the original 1.2 million tons of potassium sulfate. It plans to start production in December 2016, with a total potassium sulfate production capacity of 1.5 million tons after production starts. We believe that once production is put into operation, it will enhance Luo Potassium's economies of scale and boost profit levels. The profit forecast adjustment lowered the 2015 profit forecast by 58% to 0.46 yuan; the forecast for 2016 EPS was 0.50 yuan. The current stock price is 63x and 58x, respectively, the P/E corresponding to '15 and '16. The valuation and recommendations maintain a neutral rating. Due to the increase in performance brought about by the expansion of Luo Potassium's production, the target price was raised by 44% to 31 yuan from 21.5. The P/E corresponding to 15/16 is 67/62x. Risk fertilizer demand growth falls short of expectations, extreme weather, etc.