Investment points Fuguang Co., Ltd. focuses on precision optical lenses, has a complete product lineage, and continues to lay out new industries. Since its establishment, it has always focused on the R&D and production of optical lenses. It has now developed into a high-tech enterprise specializing in the research and production of military special optical lenses, optoelectronic systems, civilian optical lenses, optical components, etc., and is an important manufacturer of optical lenses in the world. The company plans to publicly issue 38.8 million shares, accounting for 25.26% of the total share capital after issuance, and plans to raise 651.7774 million yuan to invest in the following three projects: the full-spectrum precision lens intelligent manufacturing base project (phase I) (38,03891 million yuan), the AI optical sensing device development and industrialization construction project (105.61303 million yuan), and the construction project of a precision and ultra-precision optical processing test center (16,5078 million yuan). The company's total operating income in 2016-2018 was 469.06665 million yuan, 58,02.51 million yuan and 551.9971 million yuan respectively, and net profit of the mother was 71.9856 million yuan, 91.256 million yuan and 91.3864 million yuan respectively. The company has a complete product range, including customized and non-customized products. Among them, customized products are military special optical lenses and radio and television systems, which are mainly used in military equipment fields such as aerospace engineering, space observation, missile guidance, etc. Customized products accounted for 6.03%, 6.48%, and 12.74% of revenue from 2016 to 2018, respectively. Although they currently account for a relatively small share, due to the recognition of the company's products by military customers and military central enterprise customers, in 2017-2018, customized product revenue and business share grew rapidly, and the company's non-customized products comprised the company's main revenue. The products mainly include civil security lenses, vehicle infrared, IoT lenses, AI lenses, etc., lasers, ultraviolet, visible light, and infrared full spectrum lenses are widely used in safe cities, smart cities, the Internet of Things, and the Internet of Vehicles In fields such as intelligent manufacturing, it is the main camera supplier for leading security companies such as Axis and Dahua Co., Ltd. The company is currently actively promoting its layout in fields such as artificial intelligence and the Internet of Things. At the same time, the company's operating mechanism was innovated. The two wholly-owned subsidiaries collaborated on main business development, and participated in the Computing Domain Big Data Company to lay out next-generation technology development, promote the company's product innovation and upgrading, and promote the application of terminal products in emerging fields. The company has a full range of competitive advantages in platforms, technology, products, customer resources and qualifications. Fuguang Co., Ltd. has an outstanding position in the industry. According to TSR's report, in 2017, the company's global security video surveillance lens sales market share reached 11.8%, ranking third in the world. Among them, the varifocal lens is the company's dominant product, ranking second in global sales, with a market share of about 8.9%. The company has technological innovation and application of ultra-high-definition video in the field of security monitoring. In 2016, the global market share of 4K high-definition lenses and high-definition lenses reached 65.8%. In terms of technology, the company has achieved world pioneering design and manufacturing technology for large-aperture transmissive astronomical observation lenses, and has achieved import substitution and domestic firsts for several product lines. Moreover, the company has a high proportion of products with difficult processes, high technical content, and high added value, such as zoom and fixed focus. However, the company's competitors generally use the method of outsourcing lens processing, so there is less room for product value-added. In the same industry, the company's gross margin was higher than the industry average during the reporting period; in terms of R&D strength, although the number of people and their share in R&D was lower than that of competitors, the company had a certain advantage over competitors in terms of R&D efficiency and technological innovation capabilities, giving the company a certain level of technological competitiveness in the optical lens market competition. Overall, in terms of customized products, along with the current increase in demand for high-end military equipment and space exploration equipment, the market space for the company's customized lenses will maintain steady growth, while in terms of non-customized products, domestic security surveillance lenses, especially ultra-high-definition security equipment lenses, will have huge room for development; with the improvement of the Internet of Things and artificial intelligence technology, the market for emerging lenses such as vehicle lenses will also develop rapidly. Profit forecast We expect the company's total operating revenue in 2019-2021 to be 619 million yuan, 762 million yuan and 985 million yuan, respectively, with growth rates of 12.06%, 23.21% and 29.23%, respectively; net profit for the period 2019-2021 is expected to be 103 million yuan, 129 million yuan and 171 million yuan, respectively, with growth rates of 13.23%, 24.63% and 32.23%, respectively. EPS for 2019-2021 is expected to be $0.67, $0.84, and $1.11. Risks suggest that the company's technology and product development process falls short of expectations, and the deployment of new technology is slow, and unstable factors such as trade friction between China and the US have an impact on the company's customers, which in turn affects the company's customers, which in turn affects risks such as increased competition in the company's order industry and technology iteration