Deeply involved in the Internet of Things circuit, experts from the “Thousand Talents Program” led the company from the beginning of its establishment to move from power distribution equipment to build perceptual layer capabilities. Since then, through continuous expansion through scientific research projects, etc., a technology system covering the entire IoT industry chain has been gradually established, while the business has gradually expanded into the fields of smart environmental protection and smart cities. The company's financial performance is healthy, revenue is growing at an accelerated pace, and gross margin is increasing year by year as the share of high-margin businesses increases. The actual controller of the company has concentrated control. The actual controller and his wife hold 64.62% of the shares before issuance. The actual controller of the company is also an expert in the “Thousand Talents Plan”, laying a solid foundation for the company's future technological development. The technical system is complete, and strong implementation capabilities create and expand the foundation. The company has technical capabilities from the perception layer to the application layer, while AI applications and cloud chain databases lay out the future. The sensing layer is centered on embedded product design and intelligent sensor design technology, and has product reserves in terms of water quality, air quality, and noise. The application-level company developed its own IoT platform, which has excellent performance, and is used in businesses such as intelligent desulfurization and smart environmental protection. The company's AI is mainly used in image recognition and complex event processing. In terms of image recognition, it ranked 9th in the world in the world's top Pascal Voc Challenge, surpassing Ali Turing Laboratory. The company's cloud chain database combines cloud computing and blockchain capabilities, laying the foundation for opening up data between government departments. In addition to having a complete technical system, the company's ability to land has also been proven. After the implementation of the Tongzhou Smart Environmental Protection Demonstration, Tongzhou District maintained the highest improvement rate in the city for 6 consecutive months in the first 6 months of 2016. From smart environmental protection to smart cities, the company has broad business development space and the smart environmental protection field has maintained a high level of prosperity. From 2010 to 2018, the compound growth rate of the industry reached 19.31%, while the share of IoT applications in the field of smart environmental protection continued to increase. In this fund-raising project, the company plans to invest 446 million yuan in the atmospheric environment AI big data system construction project, and continue to expand from the current number of more than 40 customers. The company's smart city business has mainly expanded on the basis of smart environmental protection business in the past. The current fundraising company continues to invest in the big data AI R&D system, and it is expected that the smart city business will continue to explore new cities and fields as the smart environmental protection business expands. Profit forecasting and valuation The company's vigorous development of smart environmental protection and smart city businesses is expected to become the main driving force for revenue growth in the next few years. At the same time, the high gross margin of the two businesses will drive the rapid development of the company's overall performance. We expect the company to achieve net profit of 165, 2.33, and 314 million yuan in 2020-2022. The company has strong R&D strength and a high growth rate. Considering the gradual increase in the company's platform business, referring to comparable company valuations, for the sake of conservatism, we calculated a 45-fold valuation in 2021, corresponding to the company's reasonable market value of 10.485 billion yuan, corresponding to a stock price of 135.59 yuan, covering the first time, and giving it a “buy” rating. Risk warning: risk of major customer dependency; risk of seasonal fluctuations; risk of increased industry competition; risk of technology replacement.