The performance in 2019 was impressive, and the focus on the main meat products business was quite effective. The company achieved operating income of 282 million yuan in 2019, down 33.98% from the same period last year. The main reason is that during the reporting period, Zhongyu Capital was not included in the scope of consolidated statements. For example, excluding Zhongyu Capital factors, actual operating income for the current period increased by 30.24% over the same period last year. In 2019, the company achieved net profit of 34 million yuan, an increase of 497.94% over the same period of the previous year (if the Zhongyu Capital factor is excluded, and the company's impairment of share repurchase receivables of 56.1333 million yuan from Zhongyu Capital is excluded, the company's net profit to mother in the current period was 896.793 million yuan, an increase of 112.32% over the same period last year). The company focused on the main meat products business for 19 years, insisted on the steady development of the ham industry, rapidly developed specialty meat products such as sausages, bacon, meat, etc., vigorously developed the imported brand meat business, and increased profit margins. The company strives to build an industrial Internet brand of consumer goods. The company's online sales were 75.5946 million yuan, an increase of 44.24% over the previous year. At the same time, we are actively developing offline channel customers. Through channel transformation, we have not only increased the number of customers, but also improved the quality of customers. 1Q20 was affected by the pandemic, amplifying the company's strengths. 1Q20 revenue was $191 million, up 103.34% year on year, and net profit to mother was 49 million yuan, up 53.34% year on year. The specific impact of the pandemic has been transformed into new opportunities to amplify the company's strengths. Affected by the epidemic, the proportion of people eating at home has increased. Golden ham products meet the cooking needs of families and will benefit from this. Prepared meat products have performed well in the takeout supply chain, and their advantage has been magnified. The 1Q20 company is testing products such as pork ribs, etc., and sales are quite optimistic. It will continue to launch new products and channel development in the future. Benefiting from the strength of online channels and imported brands of meat and prepared meat products, 1H20 is expected to increase by 60.6%-116.7%. The company's online sales revenue from January to June 2020 is expected to increase significantly compared to the same period of the previous year, while adding business revenue from imported brands of meat and prepared meat products. Therefore, net profit from January to June 2020 is expected to increase compared to the same period last year. At the same time, the company continues to focus on the main business process, vigorously expand imported brands of meat and prepared meat products, and continue to enjoy the dividends brought by domestic and foreign pork price differences. The company has increased the import and procurement of raw materials. As of April 22, 2020, the company had 8887.55 tons of imported pork in stock and 10,397.45 tons in transit, totaling 19,285 tons, providing sufficient raw material guarantees for future production and enhancing the certainty of performance. Seize the opportunity and boost the blue ocean of plant-based meat. The company has now launched 3 plant-based meat related products. The technology developed by itself and the advantages brought by cooperation with Deniske will help the company develop a blue ocean of plant-based meat. In the future, the company's plant-based meat products are expected to match the consumption scenario and add plant-based meat products suited to the tastes of the Chinese population. Profit forecast and investment suggestions: The company focuses on the meat products business, with impressive performance in 2019 and 1Q2020, and enters the blue ocean of the prepared meat products and plant-based meat markets in the future. We expect the company will enter a period of rapid performance development in the next few years. We expect the company's 20-22 revenue to be 7.7, 12.8, and 1.82 billion yuan, respectively, with net profit of 1.8, 3.2, and 4.6 billion yuan, EPS of 0.18, 0.33, and 0.47 yuan respectively. Considering the rapid development of the company's prepared meat products industry and artificial meat industry, the profit advantage of the price difference between branded meat and pork is superimposed. Net profit is expected to grow faster than comparable companies, and can enjoy a certain valuation premium. We give 2020 PE 50 times, a corresponding target price of 9 yuan, and a corresponding market value of 9 billion yuan, giving it a “recommended” rating. Risk warning: trade frictions, large fluctuations in pork procurement prices, new product sales falling short of expectations, slow channel development, loss of asset impairment, food safety issues, etc.