Summary:

The company is located in Xinjiang and develops the agricultural product processing industry on the basis of its regional unique products. Judging from the latest announcement, the company's internal control effect this year is better than that of last year. Although revenue has declined slightly, EPS has increased by more than 100% in the first quarter, and the results will be further improved in the fourth quarter of the company's traditional sales peak season.

From the perspective of the company's sugar products, there will be two trends in the domestic and foreign markets this year. During the main sugar production season in Brazil in the second half of the year, the global sugar supply is expected to increase, but at the same time, the domestic sugar supply is still tight at the same time. And in May, the Ministry of Commerce has just adjusted the import duties outside the quota, which has a certain restrictive effect on domestic supply within a certain period of time. If the State Reserve does not sell in the second half of the year. The market will also run smoothly at high levels.

The company's tomato and jujube products are the company's high gross profit products, from the track of regional urbanization development, the market demand will further rise. According to the Ministry of Agriculture, tomato consumption in 2017 was about 42.08 million tons, a year-on-year increase of 0.8 per cent. In 2016, the planting area of jujube trees in Xinjiang has reached 47 million mu, an increase of 4% over the same period last year, of which the planting area of red jujube trees is 7.8 million mu, with an annual compound growth rate of 5.1%. This creates conditions for the business development of the company.

As people gradually understand and pay attention to the concept of health, the company's special honey products will further open the market, in addition to the normal nutritional value, special honey also has important values such as diuresis and detumescence, anti-rash, coronary heart disease, kidney disease, liver disease and gynecological diseases.

Profit forecast: we forecast that the company's EPS from 2017 to 2019 will be 0.10,0.13,0.14 yuan respectively, giving the company an "overweight" rating.

Risk tips: 1) the risk of market change; 2) regulatory risk; 3) the risk of industrial policy change.