Investment highlights: Event: The company announced its 2015 semi-annual report, with revenue of 765 million yuan, an increase of 26.06% over the previous year, and net profit to mother of 124 million yuan, an increase of 23.20% over the previous year. l Financial IC card shipments have increased rapidly, but unit prices have declined. (1) We expect the financial IC card industry to grow by about 30% in 2015, with 800 million cards issued, and an average annual growth rate of about 25%; (2) Considering that Hengbao's market share is still rising steadily, we expect the company's product shipments to be around 140 million in 15 years, an increase of 40% over the previous year. At the same time, we are strongly optimistic that the company will be shortlisted in the postal service, agricultural bank, and ICBC tenders in '16. It is expected that shipments will remain above 30% in '16; (3) As new entrants to the market increase, we expect the gross margin to drop by about 10% to 15% each year. drop ;( 4 ) Considering that financial IC cards currently account for about 50% of the company's total revenue, the company's performance growth in the next two years is guaranteed to benefit from “business reform and growth,” tax control board shipments surged in 2005; at the same time, I am optimistic about the volume of mPOS and health card business in '16. (1) Driven by “business reform and growth”, demand in the tax control market surged in 2005. As more regional lifestyle service industries are included in the scope of business reform, the industry is expected to maintain a high boom in the next 2 years. We expect the company to ship about 1 or 1.3 million tax control panels in 15 and 16, contributing to the main net profit increase; (3) mPOS satisfies the rigid needs of small and micro merchants for payment, portability, and intelligent management. Currently, the industry's shipment volume is growing very fast. At the same time, the promotion of health cards for local government residents will accelerate in 2015. We are optimistic that the company will expand in these two fields in 16 Zhang. Internet financial services for small, medium and micro merchants with One Card Easy are advancing at a rapid pace. (1) The company's key subsidiary YicaEasy's 2015 semi-annual report: Achieving revenue of 16 million yuan, a year-on-year increase of 89%, net profit of 6.55 million yuan, a year-on-year increase of 222%, and the transformation business growth is extremely strong; (2) China has 60 million micro, small and medium-sized merchants. Currently, various O2O, Internet finance and other services for this customer group have only just emerged, and the industry continues to be booming; (3) With the passing of the Hengbao MPos UnionPay test in the 4th quarter of '15, the promotion of the E-card merchant account management system will be further accelerated, and the trillion-scale Blue Ocean market is worth looking forward to. Mobile payments are ready to go. Apple Pay's entry into China will stimulate the rise of mobile payments and will benefit Hengbao's SWP-SIM card and TSM platform business. At the same time, the company announced the establishment of a 500 million yuan mobile payment security industry fund at the end of 2014. We are optimistic about the company's prospects for extended mergers and acquisitions in the mobile payment field. Maintain a “buy” rating. We expect the company's sales revenue for 15-17 to be 20.96/2,863 billion yuan, respectively, with corresponding net profit of 3.91/515/619 million yuan, and corresponding EPS of 0.55/0.72/0.87 yuan. The company has excellent manufacturing control capabilities and is a well-deserved king of the Red Sea. At the same time, the transformation business grew strongly, giving a 12-month target price of 28.8 yuan (40 times PE in 2016), maintaining a “buy” rating. Risk factors: Further decline in the unit price of financial IC cards; systemic risk in the market.