神州租车(00699) 　　Techtronic Industries (TTI) is one of the largest producers of branded power tools and floor care products in China with sales mainly in the US and Europe. Home Depot (HD), covered by our US analyst Christopher Horvers, is TTI?s largest customer and HD reported 3QFY17 (ending Oct) results with comp sales up 5.5% (stores open more than 1 year). We believe that any indicators for strong demand for home renovations would boost sentiment for TTI.We see the positive impact of potential stimulus in the US (infrastructure and other capital spending) more than outweighing the negative impact that higher interest rates may have to depress construction /renovation activities. We see the strong results from Home Depot as a good reason for looking at TTI which has underperformed the Hang Seng Index by about 10% over the past 12 months and has been one of the worst performing exporters (most exporters from China should benefit from RMB weakness).TTI has bought back 1.0m shares (on Nov 14) and has a strong balance sheet (Dec 16e debt to equity below 10% and net cash by Dec 17) to fund future buy backs.Latest update on Home Depot, extract from The Home Depot: Stronger-than-Expected Sales Drives EPS Upside with August the Low Point; LOW Laterals and Guidance Commentary �C dated 15 Nov 2016 by Christopher Horvers and the Retailing/Broadlines & Hardlines team.HD reported operating EPS of $1.60 vs. $1.35 LY (+19%), beating our $1.56 estimate and consensus of $1.58 with better sales, lower interest expense, and beneficial tax offsetting higher-than-expected SG&A dollars.Same-store sales came in well above the Street?s estimate of 5.5% and our 4.4% estimate with the U.S. at 5.9% vs. 4.5%e.Our take: strong results; don?t over-interpret the implied 4Q guide. As we previewed, investors were largely apathetic to HD heading into the print and the upside to comps (particularly the strong US performance) should invoke a positive response. Stepping back, HD averaged ~5.7% US comps over the past two quarters, suggesting a strong trend. 　　Impact on TTI �C generally positive as strong sales at HD normally translates to strong demand for TTI 　　Valuation 　　Our Dec-17 price target is based on our DCF valuation that assumes a market risk premium of 6.0% and a risk-free rate of 4.2% (yield on 10-year government notes in China). We have assumed a beta of 1.0. This is more conservative than the 0.7 Bloomberg beta. Accordingly, we assume a WACC of 9%. We estimate free cash flow until 2020 and assume a terminal growth rate of 3.0%. The terminal growth is based on the annual growth rate expected in 2020 (the final year of the estimate period) subject to a minimum of 1.5% and a maximum of 4.5%, depending on the nature of the industry and the level of maturity in China. 　　Risks to Rating and Price TargetThe key risks to our PT are a rising cost of production in China and a slower-than-expected recovery in US demand. Another risk is the implementation of new product launches and whether or not they are accepted by customers.