Incident: The company joined forces with Gulou Hospital and 32 natural person shareholders of Anqing Petrochemical Hospital Co., Ltd. to sign the “Anqing Petrochemical Hospital Co., Ltd. capital increase and share transfer agreement”. The transfer price is 8 yuan for each 1 yuan invested amount. The company acquired 87.77% of the shares with free capital of 137 million yuan, while Gulou Hospital obtained 10% of the shares with a capital increase of 2 million yuan. Comment: 1) Anqing Hospital has good hardware and software resources and obvious advantages. Anqing Hospital is only a three-hour drive from downtown Nanjing, and has obvious location advantages; Anqing Hospital covers an area of 35,000 square meters, has 512 approved beds, and actually has 562 beds; it is the only designated hospital for work injury rehabilitation in Anqing City and has a good reputation and popularity in the local area; burn surgery is a discipline unique to Anqing City; neurology, nephrology, surgery, otolaryngology, radiology, and endocrinology are key subjects and special disciplines for clinical medicine in Anqing City; 70 senior titles, 18 intermediate titles People, including Siemens 1.5T superconducting magnetic resonance, Philips 64 row, 128 layers Large and medium-sized instruments such as spiral CT, Roche and Hitachi fully automatic biochemical and chemiluminescence analyzers, angiography and DR, C-arm X-ray machines, intervertebral disc microscopes, color series ultrasound diagnostic instruments, and more than 40 hemodialysis machines. Overall, Anqing Hospital has good hardware and software resources. The advantages are obvious, and there is room for further exploration. 2) Joint Gulou Hospital is expected to build the next “Yizheng Hospital”. Gulou Hospital has a strong brand advantage in southern Jiangsu. The successful operation of Suqian Hospital and Yizheng Hospital has proved the viability of the company and Gulou Hospital to jointly distribute capital, technology, and management advantages. There are similarities between Anqing Hospital and Yizheng Hospital at the time of the acquisition: it has completed the first restructuring and is a private hospital, making it easy to further internal transformation; there is not much difference in revenue between Yizheng Hospital in 2012 and Anqing Hospital in 2014, about 176 million and 197 million; the number of beds is similar; the number of beds is similar; Yizheng Hospital prepared 500 beds and Anqing Hospital has 512 beds at the beginning of the acquisition. The company and Gulou Hospital have teamed up to strike again. It is hoped that the successful experience of Yizheng Hospital will be replicated and Anqing Hospital will become the next “Yizheng Hospital.” 3) The company's acquisition price is reasonable, and the upward trend of Anqing Hospital is obvious. The transfer price is the equity transfer price of 8 yuan corresponding to the investment amount of 1 yuan. Hospitals are scarce project resources, and currently market acquisition prices and transaction prices are high, so the company's price is basically reasonable. Anqing Hospital's revenue in '13 and January-July '14 was 180 million and 115 million respectively, profits were 2.87 million and 3.89 million, respectively, and net profit margins were 1.6% and 3.4%, respectively. Profit margins have entered an upward channel. Valuation rating: Since Anqing Hospital's current profit is small, and the timing and scope of the merger is uncertain, we maintain our original profit forecast. We expect EPS for 14-15 to be 0.43 yuan, 0.50 yuan, and 0.59 yuan respectively, corresponding to PE of 35, 30, and 25 times, which firmly establishes the company's “increased holdings” rating. Risk warning: The development of health services fell short of expectations.