Deeply involved in the South China plastic pipe market, steady growth and high quality of operation: the company is a leading enterprise with advanced process technology, large production scale, complete product specifications, and outstanding brand advantages in the plastic pipe industry in China. The company's performance has grown steadily in recent years, with a compound revenue growth rate of 14.96% in 2015-2019 and a compound growth rate of 23.93% in net profit. At the same time, the company's business style is steady, balance ratio is low, operating capacity is strong, and cash flow is abundant. Leading companies are expected to benefit from the trend of increasing industry concentration: the overall growth rate of the plastic pipe industry is declining, real estate completion is picking up, and infrastructure and municipal construction support downstream demand. With the advancement of the national full/fine decoration policy, the increasing concentration of downstream real estate developers, and the expected extension of the residential design work period, the requirements for pipe brands, quality and service capabilities are higher, leading brands are expected to benefit significantly. Xiongsu Technology has a flat sales system with distribution as the main focus and direct sales. With continuously improved product quality, high-quality customer resources, and steady management, it is expected to continue to benefit from increased industry concentration. Regional performance has gradually improved, and production capacity has been steadily increased: the company currently has four major production bases in Nanhai, Guangdong, Nanning, Guangxi, Yanjin, Henan, and Yichun, Jiangxi, as well as a production base under construction in Haikou, Hainan and a proposed production base in Yimen, Yunnan. The performance of the company's Guangxi subsidiary has developed rapidly in recent years, and the performance of production bases in Jiangxi and Henan has also gradually improved. The company plans to raise no more than 500 million yuan in capital for PVC/PPR/PE projects with an annual output of 70,000 tons in Yunnan, new pipeline materials and application technology research and development projects, etc. It is expected that as the company's production capacity continues to reach production and regional market development, the company can be expected to develop in central and southwest China while consolidating its market position in South China. In terms of product structure, the company plans to increase the weight of infrastructure municipal pipeline products according to market trends. It is expected that the PVC and PE business will maintain a high growth rate. Investment suggestions: The company is deeply involved in the plastic pipeline market in South China. Benefiting from increased downstream real estate concentration, enhanced decoration trends, extended housing warranty periods, and multiple infrastructure-side policies driving demand for plastic pipes, market share is expected to continue to increase; at the same time, it is expected that the company will moderately improve the product structure and business layout to increase the weight of infrastructure and municipal pipeline products. It is expected that as the company's municipal business expands and new production capacity is put into production one after another, the company's PVC and PE pipelines are expected to continue to be released rapidly. We expect the company's net profit in 2020-2022 to be 2.59, 3.35 and 417 million yuan respectively, corresponding to EPS of 0.85, 1.10, and 1.37 yuan, respectively, and corresponding PE of 16, 12, and 10 times; for the first time, coverage was given a “buy” rating. Risk warning: Downstream infrastructure and real estate industry fluctuation risk, raw material price fluctuation risk, industry competition risk, production capacity release for new construction projects falls short of expectations