Production capacity for fund-raising projects was gradually released, and the company's performance exceeded expectations. The company achieved revenue of 602 million yuan in the first three quarters of 2019, a year-on-year increase of 49.33%; realized net profit of 234 million yuan, an increase of 115.66% year-on-year, equivalent to EPS of 1.25 yuan/share, an increase of 115.52% year-on-year, and a weighted average ROE of 25.78%, an increase of 11.12 percentage points over the previous year. Among them, 19Q3 achieved revenue of 252 million yuan in a single quarter, up 66.90% year on year and 18.31% month on month; realized net profit of 122 million yuan, up 167.31% year on year and 50.62% month on month, and the company's performance exceeded expectations. By the end of the third quarter, all of the company's fund-raising projects had been put into operation. The gradual release of the production capacity of the fund-raising projects will greatly increase the company's production and sales scale. The company expects the company's operating performance in 2019 to increase significantly year-on-year. Currently, the price of the intermediate F nitrile and biocide products is still strong, and profitability is strong. In the first three quarters of 2019, the company's gross profit margin was 59.38%, a year-on-year increase of 13.41 pct, a net profit margin of 38.93%, an increase of 12.01 pct over the previous year, mainly due to rising prices of products such as the intermediates F nitrile and the fungicides MIT and BIT; net operating cash flow was 150 million yuan, an increase of 15.38% over the previous year; Q3 in the single quarter, the company's F nitrile, BIT, MIT and OIT prices increased 8.00%, 18.17%, 15.44%, and 9.00% over the previous year. Currently, the average price of F-nitrile remains around 80,000/ton, the BIT price remains at 20-250,000/ton, the MIT price remains around 130,000/ton, and product prices are still strong; in the third quarter, F-nitrile production was 505.54 tons, an increase of 19.94% over the previous year, an increase of 152.45% over the previous year. After the investment of the F-nitrile intermediates expansion project in the third quarter, production and sales have improved to a certain extent. It is expected that after full production in the fourth quarter, there will still be a lot of room for improvement in F-nitrile production. The company's performance has entered an explosive period, and Fnitrile, BIT, and MIT are future performance growth points. The company is the largest manufacturer of isothiazolinone industrial fungicides in Asia. It has a production capacity of 30,000 tons, OIT1000 tons, and BIT2500 tons of the fungicide CIT/MIT. The company's fund-raising projects have been put into operation in 19Q2 and 19Q3. The gradual release of fund-raising production capacity will greatly increase the company's production and sales scale. By the end of the third quarter, all of the company's fund-raising projects had already been put into operation, but they are still not fully produced. With the increase in F nitrile and BIT operating rates in the fourth quarter, there will still be plenty of room for improvement in production and sales; at the same time, due to the shortage of the intermediate methyl 3-mercaptopropionate, MIT prices have also risen sharply. Product prices have also risen sharply from about 70,000/ton to around 130,000/ton, plus some of the company's CIT/MIT production capacity transferred to production. MIT Production and sales will also increase, and Fnitrile, BIT, and MIT will be the company's future profit growth points. Profit forecast and investment rating: We expect the company's net profit from 2019 to 2021 to be 4.02/6.20/764 million yuan, and EPS to be 2.15/3.32/4.09 yuan respectively. The current stock price corresponding to PE is 17/11/9 times, respectively. With the release of new production capacity such as F nitrile and BIT and the rise in prices of products such as CIT/MIT, the company's performance is expected to grow rapidly, its performance is more flexible, maintain a “buy” rating, and continue to recommend. Risk warning: The commissioning of fund-raising projects falls short of expectations, the entry of new production capacity intensifies competition in the industry, large fluctuations in raw material prices, the risk of production safety, and the risk of large exchange rate fluctuations.