Accelerate the transformation of the operating model and maintain the “buy” rating. In 2019, the company achieved operating income/operating profit/net profit of 32.4/28/260 million yuan, +19%/+20%/+10% over the same period last year. The performance was basically in line with expectations (previous net profit expectations: 285 million). In 20Q1, the company achieved a year-on-year ratio of operating income/net profit of -1.4%/-14.2%. The main reason was that project construction implementation progress slowed during the reporting period due to the impact of the COVID-19 pandemic. Maintaining a net profit forecast of 37/46 million yuan for 2020-21, respectively, we expect 2022 to reach 520 million yuan, corresponding to EPS 1.03/1.30/1.46. The average P/E value of reference comparable companies in 2020 is 17 times. Considering the relatively high share of the company's engineering business and the impact of the COVID-19 pandemic, the company was given a target P/E of 13-15x in 2020, corresponding to the target price of 13.44-15.51 yuan, maintaining the “buy” rating. Performance continued to grow at a high rate in 2019, and performance declined in 20Q1 due to the COVID-19 pandemic. According to the company's annual report, in 2019, the company achieved a year-on-year ratio of +19%/+20%/+10% of operating income/net profit. The performance was basically in line with expectations and continued to grow rapidly. The company has plenty of on-hand orders. By the end of 2019, the company had added 3.03 billion yuan in orders, and the company's on-hand contracts totaled 10.37 billion yuan, 3.2 times the company's revenue in 2019. In 20Q1, there was a certain decline in the company's operating income/net profit. Mainly due to the impact of the COVID-19 pandemic, the resumption of work by the company and upstream and downstream enterprises was generally delayed, and project construction implementation progress has slowed down. Currently, with the company's resumption of work and production at an accelerated pace, 20Q2 is expected to recover markedly. Accelerating the transformation of the operating model, operating cash flow in 2019 improved markedly. Net operating cash flow in 2019 was 105 million yuan, compared to -0.4 million yuan in the same period last year. Cash flow improved significantly, mainly affected by the order structure. The company's stock PPP projects gradually entered the operating period throughout the year, and it is expected that stable operating cash inflows will be formed in the future. The company has continuously optimized its business structure and extended to the high-end sector of the industrial chain. The new orders mainly revolve around EPC&EP projects with a short repayment cycle (according to the company announcement, EPC and EP projects added 3.02 billion yuan in 2019, accounting for 99.7% of total new orders) and professional technical services. It is expected that the share of engineering revenue may decline in the future, and operating cash flow is expected to continue to improve. The public issuance project was approved. A multi-pronged approach to reduce capital pressure The company's balance ratio has continued to rise in recent years. As of 20Q1, the company's balance ratio reached 79.2%, an increase of 0.9 pct over the end of 19Q4. The main reason is that at present, the company's PPP orders are still large, and the financial pressure required to implement the project is high. According to the company's announcement, the company's additional issuance has been approved by the Securities Regulatory Commission, and the capital raised is no more than 700 million yuan. This move is expected to drive the company to successfully complete the investment and construction of existing PPP projects. In addition, on the business side, the company will further increase the share of equipment sales, reduce PPP projects, speed up cash returns, and approach from various angles in order to ease financial pressure. Maintaining the profit forecast and giving the “buy” rating Maintaining the net profit forecast for the year 2020-21 is 37/4.6 billion yuan, respectively. We expect 2022 to reach 520 million, corresponding to EPS 1.03/1.30/1.46. Referring to comparable companies, the average P/E value for 2020 is 17 times. Considering the relatively high share of the company's engineering business, compounded by the impact of the COVID-19 pandemic, the company was given a target P/E of 13-15x in 2020, corresponding to the target price of 13.44-15.51 yuan, maintaining the “buy” rating. Risk warning: Project progress falls short of expectations, number of new winning projects falls short of expectations, etc.