Investment highlights Nanfeng Co., Ltd. released its 2016 three-quarter report: In the first three quarters of 2016, the company achieved operating income of 487 million yuan, a decrease of 17.78% from the same period last year, and net profit attributable to common shareholders of listed companies was 21.8495 million yuan, a decrease of 64.74% from the same period last year, and the corresponding EPS was 0.04 yuan. Analysis of changes in financial indicators: There was a sharp decline in revenue and profit in the first three quarters of 2016, mainly due to the company's reduction in orders for special pipe fittings in the coal chemicals, petrochemical and other fields in the third quarter, and changes in product sales structure and sales volume. The sales volume of products with high gross margin declined significantly, resulting in a significant decline in gross margin of special pipe fittings in the third quarter; orders for ventilation and air treatment system products were basically flat, leading to a year-on-year decline in the company's net profit attributable to shareholders of listed companies in the third quarter, which in turn affected the company's net profit attributable to listed company shareholders in the first three quarters. The industrialization of 3D printing of nuclear power has achieved phased results, and products with delivery conditions are expected to be released. Up to now, Nanfang Additive has completed material development, process development, equipment reliability and stability evaluation, material inspection, etc. for simulators of nuclear power main steam pipelines. After testing by third party authorities, all performance meets the requirements of technical specifications, and has completed the printing of simulated parts of nuclear power main steam pipelines. The next step is to submit the simulated parts of the penetrators to downstream nuclear power suppliers for corresponding machining processing. After machining to form a product, a series of tests such as physico-chemical performance testing and non-destructive testing will be carried out. Furthermore, according to the progress of testing, Southern Additive will print the second and third penetrations as soon as possible. Among them, the first and second parts that have already been completed are test samples, and the third is a product with delivery conditions. Profit forecast and rating: The company is a leader in the nuclear power HAVC industry. Currently, the company has further obtained military salary quality in nuclear power, benefiting from military and civilian integration, offshore floating nuclear power plants, and the restarting of nuclear power tenders. It is expected to receive a large number of nuclear power orders in the future. The company is expected to receive a large number of nuclear power orders in the future. The company's EPS for 16-18 is expected to be 0.17/ 0.32/0.44 respectively, maintaining the “increase in holdings” rating. Risk warning: The risk of 3D industrialization failure, and nuclear power development falling short of expectations.