Key points of the report The venture capital industry will be the first to benefit from financial liberalization from a long-term perspective. In the external environment of accelerated industrial upgrading and financial reform and marketization, venture capital will usher in development opportunities in terms of products, business, and customer resources. Looking at the short term, the IPO restart and the expansion of the new third board will make venture capital “dead wood spring” that has experienced a cold winter. The exit of investment projects from IPOs at a high premium will directly increase their investment income and performance. However, the new third board not only provides exit channels, but also through participation in targeted issuance, mergers, acquisitions, and restructuring, etc., the new third board is expected to become a new “gold mining” platform for venture capital. Paradise Silicon Valley established the inflection point of the company's performance. Paradise Silicon Valley is one of the largest venture capital companies in China. It has 139 investment management projects, actual capital of 7.2 billion yuan, and 84 funds, including IPOs, ongoing projects (7), fixed growth, and industrial mergers and acquisitions. In particular, M&A funds will create a new model for domestic venture capital profit and industrial integration. Estimates show that in 2014 and 2015, the profits of various types of projects in Silicon Valley in Paradise totaled 240 million yuan and 320 million yuan, and their investment income contributions to the company reached 66.87 million yuan and 88.9 million yuan respectively, which is 3.67 and 4.87 times the company's net profit in 2012. The divestment of non-performing real estate assets and the water conservancy real estate company, a subsidiary of the company with steady growth in the water business, has continued to lose money since 2012, causing the company's performance in 2012 and 2013 to be undermined. The loss-making asset has been listed and transferred. Benefiting from residents' rigid demand for water, government subsidies for sewage treatment, and construction needs in the Zhoushan New Area, the company's water supply and sewage treatment business continues to grow, with sewage treatment volume maintaining a 10% growth rate. Moreover, compared with companies such as Hongseong Water, the company achieved higher water business revenue than other companies with lower net assets. Furthermore, the company raised 745 million yuan in targeted issuance, which will enhance the company's capital strength and raise the profit level of the water business. Overall, the profit of Paradise Silicon Valley will explode, while the main water business will grow steadily. The company's net profit is expected to be 71 million yuan and 125 million yuan in 2014 and 2015, with earnings per share of 0.25 and 0.44 respectively