The company signed an investment framework agreement with IDC service company Anxun Group to increase its capital by 54 million yuan. After the capital increase, the company will account for 30% of Anxun Group's shares. At the same time, the company released a fourth quarter business briefing. The comments are as follows: Entering the IDC field is an important extension of blockchain development. Future cooperation in cloud storage is not ruled out. Anxun Group is a company focusing on data center construction, cloud video office, cloud computing and big data, data center operation and network security solutions, and has a telecommunications service operator license in Hong Kong. Anxun Group has provided IDC services to many domestic government departments, financial institutions, and enterprise customers. The company invested in Anxun Group through a capital increase. On the one hand, it is an important extension of blockchain. IDC is the supporting infrastructure for the blockchain project, providing cloud data processing for the company's blockchain platform operation; on the other hand, considering the recent surge in demand for cloud office and cloud video due to the pandemic, some leading cloud platforms have become congested. The company has entered the cloud storage field through this move. Considering that the company's chief technology officer has a background in Tencent, possible future cooperation in the field of cloud storage is not ruled out. There was a sharp increase in single-quarter orders in the fourth quarter. The growth rate of new orders signed in the fourth quarter of last year changed from negative to positive. The company signed new orders of 2,088 billion yuan in the fourth quarter of '19, an increase of 98.5% year-on-year; new orders signed for the full year of '19 were 6.761 billion yuan, an increase of 15.5% year-on-year, a significant increase over the cumulative growth rate of -2.6% in the previous three quarters. The sharp increase in a single quarter in the fourth quarter is, on the one hand, normal quarterly fluctuations. The growth rate is relatively steady throughout the year. On the other hand, it is also related to the company's business strategy of using capital advantages to buck the trend and expand market share. This growth rate is invaluable against the backdrop of a general decline in orders for the entire decoration industry last year. The company's on-hand orders of 8.21 billion by the end of the year were not much different from the first three quarters of '19. Signing a cooperation agreement with the Agricultural Bank, blockchain took the first step in commercial monetization. The cooperation agreement between the company and the Agricultural Bank for an intended credit line of 6 billion dollars at the beginning of the year was an important step in starting business model monetization after the company signed an agreement with Tortoise Pigeon Information to jointly establish a decorative blockchain technology platform. First, this cooperation agreement is rare in the decoration industry. It can improve the company's overall bargaining power in the industry and attract many partners and even decoration companies with capital requirements to go on the chain. Second, while effectively resolving upstream and downstream cash payment pressures, it is expected that companies can collect certain handling fees and guarantee fees through supply chain loans, and the blockchain business model in the decoration industry is expected to be monetized. Considering that the intended credit line can also be used by the company itself, and currently the decoration industry generally faces the risk of banks lowering credit limits, this agreement provides a good idea for the industry to resolve financing issues, and the industry may once again open up room for growth. Investment advice The company's continued vigorous expansion in the field of technology reflects the company's determination to continuously empower traditional industries through technology. Rapid growth in orders and performance is expected to provide a good valuation margin, and expansion into the technology and property sectors is expected to bring improved valuation flexibility. We kept the company's EPS of 0.39, 0.49, and 0.59 yuan/share unchanged in 2019-2021. Maintain the target price of 12.5 yuan and maintain the “buy” rating. Risk warning: The epidemic has affected the resumption of work in the entire industry, and the investment framework agreement has not yet been formally signed