Investment highlights: No more than 630 million dollars in cash to acquire media asset management software development company Caracal. The company plans to use cash to acquire 90% of the shares of Beijing Caracal Technology Co., Ltd., with an estimated total equity of no more than 700 million yuan, and the corresponding 90% equity transaction consideration of no more than 630 million yuan. Caracal's main business is the development and operation of software to manage media assets (including music, video, and images, etc.), analysis and processing of video and music data, value-added telecommunications services, and Internet-related businesses. The company's core business, which targets the development and operation of media asset management software and the analysis and processing of video and music data, accounts for more than 90% of revenue. Performance commitments: 2016/2017/2018 are 50 million yuan, 65 million yuan and 75 million yuan respectively. The company has accumulated business over many years and has a high level of popularity and recognition in the banking IT field. In terms of software business, Nantian is one of the top ten major solution providers in the domestic banking industry, establishing five key areas of cloud applications, Internet and mobile applications, key business applications, professional applications, and software services; in terms of information product business, Nantian is a leading domestic manufacturer of specialized equipment for financial electronics, and has continuously launched and promoted new products; in terms of integrated business, Nantian has established long-term and good strategic partnerships with internationally renowned IT vendors such as IBM, Cisco, HP, AVAYA, BMC, HDS, etc., and successfully obtained investment securities in 2015. Securities and Communications Stock Integration Project. The implementation and promotion of new products and the expansion of software and service businesses have continuously boosted the company's performance. The acquisition of Caracal has not only brought informatization into a new field of industry, improved the industrial structure, and enhanced the company's performance, but also brought new high-quality customers to the company's original business. Consumption has been upgraded, copyright awareness has increased, and the music industry is extremely dynamic and promising. The development goal of the music industry during the “13th Five-Year Plan” period is to eventually reach 300 billion dollars in output value. Various operating platforms have put forward higher requirements in terms of scale, specialization, refinement, personalization, and timeliness of music content, etc., thus providing a broad market space for emerging industries such as software development and operation, music data analysis and processing related to music platforms. Caracal has a pioneering advantage in the industry and already has strong competitive strength. Caracal's downstream target customers are mainly music platforms affiliated with BAT, telecom operators, etc. Currently, there are QQ Music, Migu Music, and Tianyi Love Music. The customers are very high quality. Listed companies can make full use of the target's high-quality customer resources to carry out traditional business through acquisitions, and the synergy effect is obvious. Profit forecast and investment advice: We expect the company's main business to be stable. Caracal was combined in 2017, and the EPS for 2016-2018 exam preparation is 0.08/0.35/0.42 yuan. As an established financial informatization manufacturer, considering the company's accumulated advantages in the industry over the years, and the policy support of the country and Yunnan Province, referring to comparable company valuations, the company was given a price-earnings ratio of 75 times in 2017, with a target price of 26.25 yuan for 6 months, coverage for the first time, and a “buy” rating. Risk warning: Regulators have not passed, and industry development falls short of expectations.