Net profit increased sharply, in line with expectations. In 2015, the company achieved operating income of 3.809 billion yuan, a year-on-year decrease of 18.55%. The main reason for the decline in revenue was that the Xinjiang subsidiary Manas Aoyang stopped production in the first three quarters for environmental transformation; net profit attributable to shareholders of listed companies was 136 million yuan, an increase of 288.90% over the previous year, in line with expectations (forecast value of 139 million yuan), and net profit attributable to shareholders of listed companies was 97 million yuan, up 215.49% year on year. The reason for the sharp increase in performance is, on the one hand, the reversal in profit in the viscose staple fiber business, and on the other hand, the acquisition of Aoyangjian in 2015 and the merger of investment in the second half of the year. Aoyang Health Investment achieved transformation by acquiring the medical assets of the majority shareholder, and Aoyang Health Investment's performance was in line with expectations. In July 2015, the company issued shares to acquire 100% of Aoyang Health Investment's medical assets of Aoyang Group for 650 million yuan. Aoyang Health Investment owns four hospitals, Aoyang Hospital, Yangshe Branch, Sanxing Branch, and Shunkang Hospital, two distribution companies, Aoyang Pharmaceutical and Zhongdan Pharmaceutical, Jialong Pharmacy retail pharmacy, and Aoyu medical device sales company, successfully achieving a comprehensive layout in the fields of medical services and pharmaceutical distribution. In 2015, Aoyangjian's investment revenue was 1.51 billion yuan, and net profit was 52.97 million yuan, in line with expectations. A fixed increase in capital raising has increased the medical business, and the first rehabilitation medical chain project has been successfully implemented. It is expected that the pace of progress in the medical business will accelerate. In November 2015, the company issued a fixed increase plan, and plans to raise 960 million yuan to invest in medical business and supplement working capital. On December 23, 2015, the company reached a cooperation agreement with Xuzhou State-owned Assets Investment and Management Group Co., Ltd. to establish a joint venture to establish Xuzhou Aoyang Huaan Hospital Co., Ltd., accounting for 51% of the company's investment. On February 16, 2016, the company reached a cooperation agreement with the People's Government of Fenghuang Town, Zhangjiagang City, and agreed that the company and wholly-owned enterprises under the Fenghuang Town People's Government in Zhangjiagang City would jointly fund the establishment of Zhangjiagang New Phoenix Hospital. In December 2015, the company and Aoyang Group Co., Ltd., Societe Generale Innovation Capital Management Co., Ltd. and other partners jointly established the Shanghai Xingzheng Aoyang Equity Investment Partnership (limited partnership) (tentative name) to aid transformation through mergers and acquisitions. It is expected that the pace of development of the company's medical business will accelerate. The viscose staple fiber business has benefited from a contraction in supply and improved performance, and it is expected that the profit of this business will continue to grow in 2016. In 2015, the viscose staple fiber business contributed about 0.76 million yuan in net profit, in line with expectations. The business lost about 122 million yuan in 2014. The main reason for the improvement in performance was the contraction in supply due to environmental protection production restrictions. In the future, supply-side reforms in the industry will continue to advance. In 2016, only Zhongtai Chemical expanded production by 80,000 tons. Considering the withdrawal of backward small production capacity, the supply and demand pattern continues to improve. After the 2016 Spring Festival, the operating rate continued to rise to 90%, and the price rose to 133-135 million yuan/ton. The low inventory of enterprises combined with the peak demand season, and there is still room for growth in the future. It is expected that the company's profit level in this business will further increase. Maintain a “buy” rating. Maintaining the profit forecast for 16-17, we expect the company's EPS for 16-18 to be 0.33/0.34/0.36 yuan, the corresponding PE for 16-18 to be 37.7/36.5/35.0, respectively, and the EPS for preparing for the exam to be 0.33/0.36/0.40 yuan considering the successful issuance of additional EPS. The company's “General Hospital+Rehabilitation Medicine Flagship Store+Chain Store” layout is perfect, the business model has the ability to replicate, the transformation prospects are promising, and the “buy” rating is maintained. Risk warning: The government's medical service reform fell short of expectations; the progress of the company's rehabilitation hospital project did not meet expectations.