Description of the incident: The company recently announced that 49% of the company's shareholding company Dasheng Graphite “successfully put into operation thin-layer (1 to 5 layers) graphene production with an annual output of 30 tons, a full set of independent intellectual property rights and self-developed macroscopic preparation equipment, and controlled the cost of thin-layer graphene at 1 yuan/gram, which will resolve the current situation of “the current high cost of graphene production, limiting downstream promotion and application.” The incident review is as follows: Graphene is moving from concept to industry, and mass production costs are the biggest bottleneck. Because of its special structure, graphite has many excellent characteristics such as high temperature resistance, conductivity, lubricity, chemical stability, and plasticity. Applications include metallurgy, petrochemicals, photovoltaics, smart terminals, new energy vehicles, aerospace, nuclear power, etc. (The power lithium batteries used by Tesla can solve the pain points of rapid expansion and contraction of silicon carbon anodes by using graphene and silicon composites). However, due to the high cost of high-quality graphene, most applications are currently at the laboratory concept stage. This time, Dafu Technology subsidiary Dasheng Graphite has achieved mass production of thin-layer graphene at low cost (1 yuan/gram, industry average about 3 yuan/g) and high quality (1 to 5 layers) after 10 months of research, which will greatly promote the industrialization process of this high-performance material, which is of epoch-making significance. Horizontal comparison of Dasheng Graphite has first-mover, resource, and industrial chain advantages: Compared with similar graphene companies, on the one hand, Dasheng Graphite has an obvious first-mover advantage. Technically, China's first graphite research institute was established in 2013, and has successively cooperated with the three most authoritative domestic graphite research and development institutions, Tsinghua, Tianda, Shanxi Coal Chemical Institute of the Chinese Academy of Sciences; customers have established deep partnerships with leading domestic and international energy storage companies such as Lishen, Changhong, BYD, Zichen, Shanshan, etc.; on the other hand, Dasheng Graphite has rich resources and industrial advantages. Aspects of the company's reserves in flake graphite/microcrystalline graphite ore 4650/50 million tons. In terms of the industrial chain, mining, electricity prices, large-scale preparation equipment, and final products are fully integrated, further reducing the cost of intermediate logistics and other links. Profit forecast and investment advice: Considering the huge potential of downstream graphene applications in the future and the company's advantages in graphene's advance card, high-quality resources, and industrial chain, and with the official mass production of Dasheng Graphite's 17-year product line and the demand of downstream customers (US California lithium battery cooperation intentions, Lishen, Changhong, BYD, Zichen, Shanshan, etc.), we are optimistic about the contribution of Dasheng Graphite's performance release in 17 years to the performance of listed companies. Based on the long-term synergy between graphene materials and listed companies in smart terminals, new energy vehicle batteries, and composite materials, etc., the medium to medium company development We expect the company 2016- In 2018, EPS was 0.27 yuan, 0.46 yuan and 0.62 yuan respectively, and the performance growth rate was 119.23%, 66.28%, and 35.85%, and the target price was unchanged at 35 yuan, corresponding to PE 77x in 2017, maintaining the company's “buy” investment rating. Risk Warning: Fund-raising projects fall short of expectations; M&A effects fall short of expectations; asset injection is slowing down