Investment logic Heavy truck sales are expected to rebound. The upgrading of the National IV will bring major opportunities: With the macro-policy "pre-adjustment and fine-tuning," China's economic situation has improved, and heavy truck industry demand is also expected to gradually rise. Starting in July 2013, the vehicle diesel engine will implement the National IV emission standard, which will bring significant development opportunities to the company's business. Based on theoretical analysis and foreign experience, we believe that high-pressure common rail will become the mainstream of the fuel injection system during the National IV period, SCR will become the mainstream of heavy-duty vehicle aftertreatment systems, and supercharger business will also have great development prospects. The fuel injection system business will share the Bosch Sharing Country IV feast: Bosch Vapor Diesel will fully benefit from the increase in the share of the high-pressure common rail market after the country's IV upgrade. The high-pressure oil pump business of Weifu Gas Chai will be used exclusively for Bosch and will also fully benefit. WAPS developed by the company's headquarters is expected to occupy the low-end common rail market share, with the formation of high and low levels with the Bosch system to jointly seize the common rail market. The post-processing business is highly competitive. After the upgrade of the National IV, the demand will explode: Weifu Lida and Weifu Environmental Protection have occupied a leading position in the field of passenger vehicle after-treatment business. The SCRs, DOCs, POCs, DPFs, etc. developed by the company also have outstanding competitive advantages and are expected to fully benefit from the outbreak of demand for diesel after-treatment systems after implementation of the National IV standard. Turbocharger business is expected to rise: turbocharging is becoming more and more popular, and the proportion of light diesel engines after the National IV upgrade will be significantly increased. The company acquired Ningbo Tianli in 2010 and its supercharger business strength has been significantly enhanced. Relying on the rapid growth of industry demand, the increase in the systemization of mainframe factories and the company’s own competitiveness, the company’s business is expected to grow rapidly. Profit forecast and valuation Diluted by the latest share capital, the company's 2011-2013 EPS is forecast to be 1.90, 2.19, and 2.75 yuan respectively. According to the 2012 valuation of 15-18 times PE, the company's reasonable price is 32.55-39.06 yuan. Investment Advice The company is a high-quality parts and components company with core technological advantages and leading market competitiveness. The company's stock price is currently at a reasonable lower limit of valuation, and we maintain the company's “buy†rating. risk The sales volume of automobiles, especially the sales of heavy trucks, has not reached expectations, and the national IV emission standards have not been strictly enforced, and the country IV has realized major changes in its technological route. Toy Product Mold,Toy Product Moulds,Plastic toy product molds,Plastic toy molds,Toy Product Molds,Plastic toy product moulds Toy Product Mold,Toy Product Moulds,Plastic Toy Product Molds,Plastic Toy Molds Dongguan Anding Technology Manufacturing Co., Ltd , https://www.cn-moulds.com