Company News On February 18, 2020, the company issued an announcement. Wang Xiaohui transferred 40% of her shares in Shenghe Investment to Jin Yueyue or a third party designated by Jin Yueyue, transferred her 39.5% partnership share in Shanghai Beiyu to Jin Yueyue, and transferred 0.5% partnership share to Zhang Lu. Shenghe Investment and Shanghai Beiyi are the holding shareholders of Yinfei Storage. Previously, Jin Yueyue (Chairman) and Wang Xiaohui (former Deputy General Manager) were held. We expect that after the transfer is completed, Jin Yueyue's direct or indirect shareholding ratio will rise from 32.1% to 53.5%, but the actual controller remains the same (still Jin Yueyue). On February 4, 2020, the company issued a clarification notice stating that it has signed a high-ranking shelf supply contract with Tesla (Shanghai) for projects such as the Tesla Gigafactory (Phase I). Up to now, the total contract is 390,000 yuan, and the installation was completed by February 15. This contract has little impact on the short term, but if we can use this to become Tesla's long-term partner, we expect to contribute more than 10 million yuan in total revenue within 2-3 years. On February 4, 2020, the company announced that as of the end of January 2020, a total of 4.68 million shares had been repurchased through centralized bidding transactions, with a payment amount of 34.35 million yuan, accounting for 1.55% of the company's total share capital. There is still room for about 15 million yuan until the minimum repurchase limit of 50 million yuan. Commentaries note that the new production capacity of the Ma'anshan and Nanjing Binhai New Area projects will be implemented one after another in 2020/21:1) The total investment of the Ma'anshan project is 1 billion yuan, and the additional shelf production capacity will reach 100,000 tons after the completion of the project. Currently, construction of the project has begun, and we expect some production to be put into operation as early as the fourth quarter of 2020. If production capacity is fully released, it will contribute 1 billion yuan in revenue. The company's average gross margin/net profit margin from 2012 to 2018 was 34%/13%, respectively. This production line expansion will contribute 340 million yuan in gross profit and 130 million in net profit. 2) The Nanjing Binhai New Area project has a total investment of 300 million yuan. We expect it to be completed in the second half of 2021. The valuation recommendation takes into account that the company's business volume affected by the pandemic in 2020 may be lower than expected. We lowered 2020e's profit 9% to 106 million yuan and introduced 2021 net profit of 132 million yuan. The neutral rating and target price of 7.5 yuan are maintained for the time being, corresponding to 22.4 times the 2019 price-earnings ratio and 21.3 times the 2020 price-earnings ratio. The current stock price corresponds to 26.2/25.0 times the price-earnings ratio in 2019/20, which has 15% downside compared to the target price. The duration of the risk epidemic has exceeded expectations, and steel prices have fluctuated sharply