The cooperation between Donghua and Huawei Kunpeng is expected to usher in a second time. The significance of the cooperation between Donghua and Huawei Kunpeng is 1) Server production and sales are a new performance growth point. 2) Expanding software market share. While the company's software was the first to be integrated into Kunpeng, it will also benefit from the growth of Kunpeng's computing industry and seize opportunities in continuous run-ins. 3) Cloud MSP transformation opportunities. Traditional IT service companies focus on system integration and software development, with low gross margin and low labor efficiency. With the Huawei ecosystem, the company is expected to accelerate its transformation. The company's EPS for 2020-2022 is expected to be 0.36, 0.44, and 0.51 yuan respectively, covering the “buy” rating for the first time. The company is the number one IT integrator in China, the number one IT integrator, and has high-quality customer resources. The company has more than 70 branches across the country, forming marketing service channels all over the country. In addition to channels, with long-term accumulated customer resources and deep understanding of the industry, the company can efficiently connect with upstream products and downstream demand, and quickly bridge the gap between giants and industry customers. For tech giants such as Tencent and Huawei that have not been involved in the industry's IT market before, cooperating with excellent integrators is a win-win move. Tencent participated in shares to explore cloud healthcare. The post-pandemic era has great potential for development. In 2017, the company signed an agreement with Tencent, and the cooperation was officially launched. In March 2019, the two sides jointly released iMedical Cloud and launched Cloud HIS at the same time, and the “one chain, three clouds” strategy was gradually implemented. Through cooperation with Tencent, the company can serve more small and medium-sized customers, increase commercialization rate, and improve performance elasticity on the basis of existing high-end customers. The COVID-19 epidemic broke out, and Donghua is actively fighting the epidemic. The current epidemic has also brought opportunities to medical IT segments such as Internet healthcare, regional health, and medical insurance fee control, and the industry is expected to maintain a high level of prosperity. It is expected to take the lead in the IT localization wave, covering the “buy” rating for the first time. We expect the company's operating income in 2020-2022 to be 101.75, 119.97, and 14.087 billion yuan, respectively, to achieve net profit of 11.37, 13.83, and 1,601 billion yuan, corresponding to EPS of 0.36, 0.44, and 0.51 yuan, corresponding to PE38, 31, and 27 times. We selected government IT system integrator Taiji Co., Ltd., China Software, Huayu Software, and China Great Wall, a domestic computer hardware manufacturer, as comparable companies. Comparable company Wind unanimously predicted an average price-earnings ratio of 52 times in 2020. Considering the cooperation between the company and Huawei Kunpeng, it is expected to take the lead in the IT localization wave in the industry, giving the company a target PE of 52-55 times in 2020, corresponding to the target price of 18.72-19.80 yuan, coverage for the first time, and a “buy” rating. Risk warning: Kunpeng's ecological implementation progress is lower than expected; downstream payment capacity falls short of expectations; risk of impairment of goodwill.