The company's insulator industry and environmental protection equipment each account for about 30% of the company's main business, and they are also the two businesses with high gross profit and the most concerned market. The inflection point of the industry is beginning to appear, and the bottom of the insulator business is picking up.

2011 the decline in the growth rate of power grid and railway investment has led to a downturn in the insulator industry, and with the recovery of grid and railway investment, the company said the situation will improve in 2012. The company received an order from the Ministry of Railways at the end of 2011 and also participated in the first order of this year's tender of the State Network Company. There are obvious signs of an inflection point in the industry.

Demand for high-end insulator products has always been greater than supply, and the company has previously targeted additional investment projects to expand production capacity. At present, the company's production line has been producing at full capacity, so it is difficult to break through the growth of output in a short time, only gross profit margin can be broken. At the end of last year, the top manufacturers of the industry reached a consensus not to fight a price war, to pursue product differentiation and to raise the gross profit margin of high-end products.

The company said that although the private placement failed, it would use its own funds to invest in the previously scheduled additional investment projects. The recent shareholders' meeting signed a "Financial Services Agreement" with Suzhou Chuangyuan Group Finance Co., Ltd., in order to save financial costs and improve the level and efficiency of the use of funds.