Event: On October 14, the company released its performance forecast for the first three quarters. The first three quarters achieved net profit of 117 million yuan to 125 million yuan, an increase of 40%-50% over the same period last year. Net profit of 47.075 million yuan to 55,4027 million yuan was realized in the third quarter, up 6.66%-25.53% from the same period last year. According to the announcement, the main reason for the large increase in the company's performance is that the performance of the company's alternative products has increased dramatically and financial expenses have dropped significantly. The addition of growth-promoting antibiotics to commercial feed has been prohibited since July 1 this year, and the performance of alternative products has increased dramatically. In the first half of the year, the revenue of alternative products increased by 45.03% year over year. Since the “Ministry of Agriculture and Rural Affairs of the People's Republic of China Notice No. 194” of the drug feed additive withdrawal plan was only officially implemented on July 1 this year, it is expected that sales of antibody products in the second half of the year will increase even more than in the first half of the year. Our in-depth report estimates that the domestic drug replacement market has a potential space of 10 billion dollars. The company's antigen products are one of the two Chinese veterinary drug additives allowed to be added. It has first-mover advantages and channel advantages, and is expected to increase its market share rapidly. It is expected to maintain a growth rate of more than 50% over the next three years. Interest on financing loans has been reduced, and financial expenses have been greatly reduced. The company continues to optimize capital allocation and improve the efficiency of capital use. Reducing capital expenditure in the future will effectively reduce financial expenses and increase net profit margins. Among them, the financial expenses for the semi-annual report were 24.54 million yuan, a year-on-year decrease of 38.31%, and the net interest rate increased to 8.77%, an increase of 3.02% over the same period last year. The company's three major businesses all have growth points in the future, and there is plenty of room. 1) The anti-rival business is expected to occupy a large market share in the 5-10 billion anti-rival market in the next 5 years due to its early layout and first-mover advantage and channel advantages. 2) Sex hormone production capacity is expected to start producing benefits the next year. This segment of business has a high threshold, high demand, and strong profitability. 3) The non-feed enzyme preparation production line (15,000 tons of food grade enzyme preparations) has been completed and put into operation, and the products are expected to be replaced domestically. Investment suggestion: The company is a domestic leader in biological enzyme preparations. It has the entire industry chain from phytosterols to finished APIs. In the future, it will increase its international layout and forward-looking layout of alternative products. With its first-mover advantage and its own channel advantages, the company is expected to quickly seize this blue ocean market. The company's 2020-2022 EPS is expected to be 0.42, 0.59, and 0.76 yuan, and the corresponding PE is 34.0 times, 24.5 times, and 18.9 times, respectively, maintaining the “recommended” rating. Risk warning: downstream aquaculture industry epidemics, natural disasters, cyclical fluctuations in sales, bad debts on accounts receivable, project investment falling short of expectations, market development falling short of expectations