The growth rate of the ship repair and manufacturing industry in Yingkou is expected to remain at 15-20%. At the same time, as the industry concentration continues to increase, leading companies will have a higher growth rate. Combined with a comprehensive analysis of industry growth and market value, our investment rating for the shipbuilding industry is “overweight”.

Since the second half of 2002, the international shipping and shipbuilding markets have experienced unprecedented prosperity, and people are generally optimistic about the market prospects. However, in recent months, the international shipping market has fluctuated, and the shipping rents of oil tankers and bulk carriers have declined, and the international shipbuilding market has also Subtle changes have taken place. We believe that the international shipbuilding market is entering an "adjustment period", from a "peak" state to a "plateau" state, that is, the total volume of new ship transactions will decrease, and the price of new ships will not continue to rise, and will be smoothly coordinated. However, all parties also agreed that the shipbuilding market will not collapse.

For my country’s shipbuilding industry, in view of factors such as international market capacity standards, domestic market scale standards, exclusive advantages standards, employment standards and strategic significance standards, we believe that the shipbuilding industry is well-deserved to be selected as the key export industry supported by contemporary China. It is expected that a series of support measures such as subsidies, trade restrictions, administrative guidance and credit allocation for the shipbuilding industry in my country will surface in the near future, and the industry is still expected to maintain a steady growth rate. From a medium and long-term perspective, the improvement of the world economic situation, the rapid development of my country's foreign trade, the needs of China's marine industry and the development mission of the shipbuilding industry in the 21st century, these three factors work together to determine the future development of China's shipbuilding industry. At the same time, the world's port construction led by China will enter its peak again from 2006 to 2007. In the next three years, three major products such as marine diesel engines, containers and cranes are still worth looking forward to.

We believe that the embarrassing and contradictory position determines the investment opportunity for China's shipbuilding industry. On the one hand, the current annual output value of China's shipbuilding industry exceeds 50 billion yuan, and it will absorb more than 5 million industrial workers. The output of civilian ships as the main body will reach 11 million tons in 2005, ranking third in the world; at the same time; The shipbuilding industry is an industry of great international political and military strategic significance; on the other hand, there are currently very few listed companies in China's shipbuilding industry. This particularity indicates a good growth space for individual stocks in China's shipbuilding industry in the future. In terms of buying time, we believe that mid-2007 is the time to buy gold, and the current time is a good time for phased investment.