The incident company released a three-quarter report. The first three quarters achieved operating income of 498 million yuan, a year-on-year increase of 20.43%; realized net profit of 136 million yuan, a year-on-year increase of 27.39%; achieved net profit of 119 million yuan, a year-on-year increase of 38.94%; comments 1. The military business began to gain strength, Q3 achieved high growth in a single quarter, the company achieved revenue of 221 million yuan, an increase of 61.55% year-on-year; realized net profit of 66 million yuan, a year-on-year increase of 167.67%, and a year-on-year increase in non-net profit 239.40% Among them, the military products business contributed 42.96 million yuan in net profit, excluding equity incentive amortization expenses, and achieved net profit of nearly 50 million yuan, a significant increase over the previous year. Currently, the military industry business has begun to gain strength and is expected to continue to exceed market expectations. 2. Revenue recognition for the main business was not timely due to the impact of the epidemic. The fourth quarter is expected to improve the main business's net profit by 23 million yuan in a single quarter, mainly due to the epidemic, which has led to delays in product delivery and untimely revenue recognition. Relevant financial indicators reflect that the main business orders are relatively good. Among them, “accounts receivable financing” increased 41% from the beginning of the year; “inventory” was 4.2 billion yuan, a significant increase over the previous year, mainly due to an increase in main business inventory; “contract liabilities” of 240 million yuan, up 38% from the beginning of the year, accounting for about 40%-50% of the total contract signed. According to this estimate, the contract amount corresponding to 240 million contract liabilities is about 5-6 billion yuan. The company's orders have definitely increased over the same period last year, and have exceeded the revenue scale of the main business of 480 million yuan for the whole year of last year. Shipment progress is expected to accelerate in the fourth quarter, and the main business will improve significantly month-on-month. 3. Profit forecasts and investment recommendations expect the company to achieve operating income of 923/12.57/1,776 billion yuan in 2020/21/22, respectively, net profit of 2.62/3.94/625 million yuan, EPS of 0.25/0.38/0.61 yuan, and corresponding PE of 42/28/17 times respectively. Given that the current accelerated release of domestic military aircraft and future mass production of large domestic aircraft will drive the rapid development of the aviation parts processing and component assembly market, the company is expected to fully benefit and maintain a “buy” rating 4. Risk warning that the release of military orders and confirmation of main business revenue falls short of expectations; profit and valuation forecasts fall short of expectations.