Core opinion: 1. The market has overreflected the impact of the ZTE incident on the company's business situation. Currently, the direct impact is reflected in the insufficient utilization rate of some of Tefa Dongzhi's production capacity, but due to the expansion of the company's total production capacity, the company's related business revenue has not declined so far. 2. Through the establishment of a joint venture with Changfei in the optical fiber optic cable business, the bottleneck in optical bar production capacity will be alleviated. In the future, the company will match production capacity from optical rods to optical fibers to optical cables, and profitability and scale effects will gradually be reflected. 3. The military informatization business layout is clear. The ballistic computer business achieved a breakthrough in orders in 2017, and the military business is expected to continue to grow in 2018. Main content: The company's main business includes three parts: 1) The first part is the fiber-optic cable business, which currently accounts for less than 40% of total revenue. The company and Changfei set up a joint venture to resolve the bottleneck in the supply of light bars. The infrastructure for expanding optical fiber production is coming to an end, and production capacity can be formed by the end of the year. The current production capacity of optical cables is 20 million, matching the production capacity of 600 tons of prefabricated rods. 2) The second part is the military electronics business, with Fourier as the main body. The company will continue to lay out and expand in this area in the future. Fourier's overall business achieved a net profit of 42 million last year, and the gamble has already been completed. The overall business progressed significantly in 2017, and the order for the launch computer was already packed. The other is a telemetry product that has now been in operation for two years and achieved revenue of 30 million in 2017. In the future, it is planned to expand in Fourier's original business. One of the company's convertible bond investment projects is a research and development project for Fourier (Chengdu Fourier Measurement and Control Earth Station Data Link System Project). In the future, the company will continue to increase telemetry technology. This area is being developed jointly with an air force base. The latter provides site and test support. In addition to this, Fourier is bidding for the military CDMA mobile phone project this year. Judging from the winning bid share, it is estimated that there will be an order volume of 35,000 mobile phones. 3) The third part is the optical access business. Currently, the main focus is Tefa Dongzhi and Optical Network Technology. At the end of last year, Dongzhi expanded its production capacity from 26 to 49. Last year, Dongzhi's sales to ZTE were 1.4 billion dollars, accounting for 57% of Dongzhi's total revenue. It is expected that this year's share will decline. Currently, 30% of the company's production capacity has been discontinued due to the ZTE problem, but this part of the production capacity company can find corresponding downstream customers to fill it up. Currently, the company is still awaiting further news from ZTE. Regardless of the outcome, Dongzhi's business and market needs exist, and this will not be affected. Currently, the company's overall output is the same as last year, and Dongzhi's revenue for the first half of the year has not declined so far. Risk warning: trade friction between China and the US has escalated, production capacity expansion has fallen short of expectations, and military business orders have fallen short of expectations.