The “Jinling+Gulou” cooperation model may guarantee the healthy expansion of the company's medical service business. The success of Suqian Hospital and Yizheng Hospital proves the effectiveness of the “Jinling+Gulou” cooperation model (Jinling provides capital, Gulou exports technology and management). We believe that this model is highly replicable, and the company's medical service business is expected to achieve healthy expansion. We believe that mergers and acquisitions are the most important means for a company to expand its medical services business, and we recommend investors to pay attention to the company's extension progress. The medical service business is expected to maintain steady growth of 15-20%. After the company acquired the new hospital, management of Gulou Hospital was introduced, which in turn increased the hospital's net profit margin and led to an increase in profit. Considering factors such as the merger of new hospitals and the increase in net profit, we expect the company's medical service business revenue to maintain a steady growth of 15-20% over the next 3 years. The pharmaceutical business will maintain steady growth. The company's pharmaceutical business is dominated by the parent company's maveronine injection. The maveronine injection is one of the varieties of traditional Chinese medicine injections with the longest history of use in China, and has a high level of clinical recognition. We believe that the product has now emerged from the 12-year quality crisis, and pharmaceutical revenue is expected to maintain a steady 5-10% increase in pharmaceutical revenue in the next 3-5 years. Valuation: The target price is 24 yuan. Reiterating the “buy” rating, we got a target price of 24 yuan (WACC = 8.1%) based on the UBS VCAM valuation tool. The current stock price corresponds to 34 times PE in 2016, while the average valuation of the medical services sector is 76 times. We believe there is a lot of room for the company's stock price to rise, and we reaffirm the “buy” rating.