Recently, the China Machinery Industry Federation issued “” Twelve Five “Machinery Industry Development Master Plan.” The plan, “second five” to the implementation of China’s machinery industry during the five development strategies, and targets the five priority areas to achieve the six goals, step by step to the “from large to strong” forward.

2. Our analysis and judgments

(A) of the next ten years is still the machinery industry’s “golden years”

We believe that the machinery industry is a gold mine to be excavated, huge space for development over the next decade. Machinery industry is China’s largest industrial sector, industrial output value of the new century from the 1.44 trillion yuan in 2000 increased to 14.38 trillion yuan in 2010, the average annual growth rate of up to 25% or more, the overall scale has been ranked first in the world one.

(B) upgrades, import substitution and create market demand, strengthen the basis of conservation and environmental protection was raised to new heights

The plan of the machinery industry, “second Five-Year” during the five development strategies: “main high-end, innovation-driven, and strengthen the basis of integration of the two, the green first.”

We believe that the “second Five-Year” period, the product upgrade and import substitution will create a huge market demand, is to promote the development of the industry the two drivers.

(C) high-end CNC machine tools, critical infrastructure components, energy saving equipment, and other segments should focus on

The plan, the machinery industry, “Twelve Five” period to focus on developing high-end equipment, new industries and equipment, people’s livelihood, machinery and equipment, critical infrastructure products, processes and technologies based on five major areas.

3. Investment advice we believe that the development of machinery industry a huge space for the next decade. Proposes a focus on high-end CNC machine tools, critical infrastructure components, energy saving equipment, and other segments.

We are optimistic about prospects for the future development of the industry, maintaining the “Recommended” rating.