Guide to this report: State-owned investment enhances the company's competitiveness. Currently, the market still has a lot of room for growth after the rail exchange. The company's performance is expected to bottom up. It is covered for the first time, and it is rated for a cautious increase in holdings. Key investment points: Conclusion: Central enterprise holdings provide resource support and strengthen R&D investment to create a moat for enterprises. After rail transit, market incremental demand and stock demand go hand in hand, and there is great potential for the future. The company's EPS for 2019-2021 is expected to be 0.16 yuan/0.18 yuan/0.21 yuan respectively. Referring to the average valuation level of the industry, the company will be given 24 times PE in 2019, corresponding to the target price of 3.84 yuan. For the first time, coverage is given, and a prudent increase rating is given. State-owned investment comprehensively enhances the company's overall competitiveness. In 2018, SDIC Hi-Tech became the controlling shareholder of the company, and the company became a pilot enterprise for SDIC Hi-Tech's mixed ownership reform. The entry of state-owned assets can further broaden the company's layout in the rail transit industry chain and significantly enhance the company's overall competitiveness in the post-rail transit market. After rail transit, the market space was vast, and demand for incremental stock was strong. In the railway sector, China has gradually moved from a large-scale design and construction stage to a stage of equal emphasis on construction, operation and maintenance. The rail transit operation and maintenance industry, including vehicle operation and maintenance, traction power supply, and public engineering inspection and monitoring industries, has entered a boom cycle with broad market prospects; in the urban rail sector, fixed asset investment growth rates of 24% and 15% in 2017-2018, respectively, have maintained a high growth rate, and incremental demand is still strong. Catalyst: Implementation of a policy to stimulate railway infrastructure. Risk warning: risk of policy changes, risk of increased market competition