Incident: The company announced a capital increase of 4.9 million US dollars (approximately RMB 31 million, accounting for 5.28% of the company's net assets in the company's most recent audited consolidated statement) to Zhunyou Tianshan, the company's Kazakh subsidiary, to use all of its registered capital to transfer two nitrogen production equipment and two sets of fracturing equipment to Zhunyou Tianshan and supplement working capital. The capital strength of Kazakh subsidiaries will be greatly enhanced. The capital structure has been significantly optimized until 14Q1, and Zhunyu Tianshan has total assets of 6.25 million yuan and net assets of 3.04 million yuan. After this capital increase is completed, its total assets will rise to about 37 million yuan, net assets of about 28 million yuan, balance ratio of about 25%, capital strength will increase dramatically, and capital structure will be significantly optimized. The ability to undertake service projects for Kazakh oil fields will be significantly improved. Before the steady transition to the oil company's general contractor and capital increase, Zhunyou Tianshan mainly obtained two sets of fracturing equipment units through equipment leasing (and since one of the 2000 equipment units has no workload during maintenance and transportation, only one set of fracturing equipment can actually be used). After this capital increase is completed, (1) the company will concentrate the two sets of nitrogen production equipment and two sets of fracturing equipment currently located in Kazakhstan in Zunyou Tianshan, which will significantly enhance the ability of Zunyou Tianshan to undertake individual oil field service projects; (2) through comprehensive management of these four sets of equipment, Zunyou Tianshan's ability to carry out integrated oil field development and management in Kazakhstan will also continue to improve, and the company is making steady progress in its short-term strategic goal of becoming the general contractor of oil companies. The main purpose of the equipment is to increase production. Nitrogen generation equipment, which is less difficult to carry out business in Kazakhstan, is used for gas lift (gas injection to increase production), and fracking equipment for old oil wells is also one way to increase production in low-production oil fields. Therefore, overall, the advantages of short-term oil quasi-Tianshan are mainly due to increased oil field production. This is in line with the current situation where the Kazakh oil and gas industry, especially small and medium-sized oil fields, urgently need to increase production. Therefore, it is relatively less difficult for successor companies to do business in Kazakhstan, and there is a lot of room. Maintaining a “buy” rating: The company's competitive advantage lies in its ability to provide comprehensive integrated development management for inefficient oil fields, and the Kazakh oil and gas industry is extremely in demand for technology to increase production due to technology, capital, etc., so we are optimistic about the development space of the company's Kazakh oil and gas business. After this capital increase is completed, the company's ability to undertake oil field services in Kazakhstan will be greatly increased, and the development of Kazakh oil and gas business will go one step further. We maintained the company's 14-16 EPS of 0.45 yuan, 0.85 yuan, and 1.08 yuan, respectively, and maintained the “buy” rating. Risk warning: The risk that Kazakhstan's oil and gas business is progressing less than expected.