The boom pattern of the optical circuit has not changed, and the penetration of multiple cameras is progressing simultaneously with technological upgrades. The trend of mobile phone camera upgrades has not changed. From a quantitative point of view, the penetration of multiple cameras continues to accelerate, and the number of stand-alone cameras is constantly growing; from a price point of view, new technologies such as high pixels, 3D sensing, and periscope have driven the value of a single camera to increase, further opening up profit margins. Optics and optoelectronics business continues to improve, and performance is steadily improving. As the company's traditional business and pillar industry, camera modules accounted for 59% of total revenue in 2019, and the number of shipments continued to rank first in the industry; at the same time, the company actively deployed the upstream industry chain, and the lens business began to take shape. Since 2020, it has achieved mass production and shipment of 6P products, and the business has entered a healthy upward channel; in terms of touch display, by divesting the Android touch business and superimposing the tablet business volume of major downstream customers, it is expected that the company's touch display business will turn a loss into a profit within the year. The microelectronics business is growing rapidly, sharing development dividends with the industry. In terms of 3D sensing, the company has both structured light and ToF solutions, and has now become the main supplier of 3D sensing modules in China; in the field of fingerprint recognition, the company, as the only core supplier in the world with mass production capabilities of optical+ultrasonic solutions, has become number one in the industry since 2016. With the continuous growth in shipments of OLED under-screen fingerprint phones and the development of under-screen fingerprint unlocking solutions adapted to LCD screens, the company is expected to follow the development of the industry and enjoy incremental dividends. Targeted additional distribution helped the company grow, and financial expenses improved markedly. In June of this year, the company announced a fixed increase plan involving the expansion of production of three projects: camera modules, high-resolution lenses, and 3D sensing. It is expected that this launch will help the company enrich the product structure, achieve integrated lenses+modules, better meet industry needs, and enhance the overall competitiveness of optical products. In addition, the company officially signed a contract with Accenture for the “Financial Informatization and Supply Chain Material Management Project” in 2019. The company's debt level continued to decrease, and the trend of improving financial expenses was obvious, effectively reducing financial risks and promoting the company's virtuous circular development. Profit forecasts and investment recommendations: We expect revenue of 512.0 billion/56.5 billion/63.6 billion for 20/21/22, and net profit from the mother to reach 1.36 billion/1.95 billion/2.48 billion in 20/21/22. The current market value corresponds to PE = 38x/26x/21x, which for the first time covered the “increase in holdings” rating. Risk warning events: excessive penetration falls short of expectations, production expansion progress falls short of expectations, and the impact of the epidemic worsens