A description of the event. Hengbao Co., Ltd. released its 2015 semi-annual report. The report shows that in the first half of 2015, the company achieved operating income of 765 million yuan, an increase of 26.06% over the previous year; realized net profit attributable to shareholders of listed companies of 124 million yuan, an increase of 23.20% over the previous year; and realized net profit attributable to shareholders of listed companies after deduction of 110 million yuan, an increase of 20.67% over the previous year. In the first half of 2015, the company fully diluted EPS to 0.17 yuan. The company released the 2015 three-quarter report forecast, and the net profit for the first three quarters of 2015 is expected to increase by 20%-40% year on year. Incident reviews. The number of cards issued has increased dramatically, driving rapid growth in revenue performance: The main reason for the rapid increase in revenue is that there has been a sharp increase in financial IC card shipments. Furthermore, mobile payment cards have begun to be supplied in batches, leading to a 24% increase in revenue from the main card business over the same period last year. The main reasons for the rapid increase in net profit are: 1. While the scale effect triggered by revenue growth was prominent, the company strengthened cost and expense control, which caused the period expense ratio to drop by 1.34 percentage points year on year; 2. Export tax rebates on software products increased non-operating income by 10.91 million yuan, an increase of 187% over the previous year. The smart card industry has maintained a high level of prosperity, and new business development is progressing steadily: We reaffirm that China's financial IC industry continues to grow rapidly, NFC mobile payments have entered a period of accelerated development, and the company will be the biggest beneficiary of the boom in the smart card industry with its customer channels and share advantages. In addition, the company continues to expand new businesses and has made positive progress. Specifically, in the context of “business reform and growth”, the company actively develops tax control business and has received sufficient orders, and the tax control business will gradually become the main growth point for the company's future revenue performance; 2. Focusing on the mobile payment industry, the company develops a comprehensive mobile payment management platform and security solutions, and participated in application development, TSM debugging, and commercial promotion of the three major operators. Furthermore, Bluetooth second-generation USBKey has been commercialized and won the bid for Bank of Guiyang. IC card internet payment terminal products have been shortlisted in CCB, Agricultural Bank and achieved batch supply 。 Fixed capital raising to lay out Internet finance and build a service platform operator for small, medium and micro merchants: In May 2015, the company plans to invest 650 million yuan, 150 million yuan, and 200 million yuan respectively for the construction of a service network and system for micro, small and medium-sized merchants, acquire 51% of the shares of One Card Easy, and overall mPOS solution development and industrialization projects, with the aim of improving all aspects of Internet finance to further lay out the service system for micro, small and medium-sized merchants. Currently, the number of merchants served by the company is steadily expanding, aiming for the number of active merchants to reach 1 million in the next three years. mPOS products have passed the product safety assessment by the BCTC testing center and achieved commercial listing, and the service business for small, medium and micro merchants is progressing well. Investment advice: We are optimistic about the company's future development prospects. We expect the company to fully dilute the EPS in 2015-2017 to 0.58 yuan, 0.76 yuan, and 0.98 yuan, reaffirming the company's “buy” rating.