Incident: The company recently released an asset purchase report and plans to acquire 49% of Mijian Information's shares with 202 million yuan. Of these, the proposed shares will pay 162 million yuan, and the issue price will be 13.75 yuan/share; and 403.76 million yuan will be paid in cash. It is intended to raise no more than 97 million yuan in supporting capital from Housshi Investment, Rongtuo Investment, and CICA Investment to issue shares to pay cash consideration, intermediary fees, and supplementary working capital. The acquisition of minority shareholders' interests in Mijian Information will further strengthen its strength in the field of clinical medical informatization. Mijian Information is a medical informatization solution provider with core technology. Its main products include IT application systems and solutions for the medical industry, such as clinical information systems and intelligent integrated cloud platforms; it focuses on the application of clinical information systems in critical situations, and can provide customers with clinical information systems such as emergency clinical information systems (ECIS), intensive care clinical information systems (ICIS), surgical anesthesia clinical information systems (AIMS), and clinical information systems for in-hospital clinical departments, combined with cloud computing, big data, and the Internet of Things to provide customers with urgent risk Medical informatization solutions for entire hospitals, group hospitals, and regional applications, such as critical illness cloud platforms and regional emergency collaboration cloud platforms. In September 2015, the listed company acquired 51% of Mijian Information's shares at a price of 128 million yuan. With this acquisition of its minority shareholder interests, Mijian Information will become a wholly-owned subsidiary of the company, which will facilitate the company's control over Mijian Information, further strengthen the sharing of technology and market resources, and enhance the company's competitive advantage in the field of clinical medical informatization. Performance increased by about 10%. The counterparty in this transaction promised that Mijian Information's audited net profit in 2016-2018 will not be lower than RMB 2327, 3070, and RMB 40.56 million, respectively. If this acquisition is successful, considering the increase in share capital and the share acquisition ratio, the company's EPS will increase by about 10%, which will contribute to increasing the company's profitability to a certain extent. Medical informatization has broad prospects, and the company focuses on the fields of smart medicine and health data. According to IDC statistics, China spent 22.31 billion yuan on medical IT in 2014, and it is estimated that the size of the IT spending market in the medical industry will reach 42.53 billion yuan by 2019, so there is broad scope for future market development. The company takes the field of clinical medical informatization and medical big data as the key direction for future development, and strives to become a leader in the field of clinical application segmentation, a regional leader in the direction of data platforms, and an innovator in the field of healthcare big data. Profit forecast: Regardless of this acquisition, in 2016-2018, we expect the company to achieve net profit attributable to the parent company of 7183, 9028, and 10.49 million yuan, respectively, and EPS of 0.19, 0.23, and 0.31 yuan, respectively, corresponding to PE of 74, 60, and 45 times. If this acquisition is successful and completed in 2016, we expect the company's EPS in 2017-2018 to be 0.27 and 0.35 yuan respectively, and the corresponding PE is 52 and 40 times, respectively. We are optimistic that the company will strengthen its competitive advantage in the clinical medical informatization segment through external mergers and acquisitions, and gradually develop into a leading enterprise in the fields of smart medicine and health data. First coverage, giving the company a “recommended” rating. Risk warning: (1) market competition intensifies; (2) M&A progress falls short of expectations; (3) counterparty performance promises cannot be fulfilled.