Liaoning Chengda (600739.CH/RMB 17.90, buy) announced the 2016 interim report: revenue of 3.8 billion yuan, a year-on-year decrease of 5.5%; net profit of 720 million yuan, a year-on-year decrease of 41.3%; basic earnings per share of 0.47 yuan. Bank of China and Africa Bank comment: The development of various sectors is stabilizing, and performance has entered a recovery channel. The company's business is mainly divided into four major sectors: biopharmaceuticals, trade circulation, energy development, and financial services. The biopharmaceuticals sector achieved sales revenue of 470 million yuan and total profit of 280 million yuan. The trade distribution sector achieved sales revenue of 3.31 billion yuan and a total profit of 40 billion yuan. The energy development sector achieved sales revenue of 18.31 million yuan and a total profit of -220 million yuan. In the financial sector, Guangfa Securities and China Insurance contributed 660 million yuan and 250 million yuan in investment income respectively. Although investment returns from joint ventures and joint ventures have declined, the development of the energy sector is stabilizing, and performance is gradually recovering. The profitability of core assets is strong, and moving forward lightly releases pressure on operations. The company's core assets (biopharmaceuticals, pharmaceutical distribution, securities, insurance, etc.) are profitable. The energy sector stopped losses in a timely manner, implemented a long-term shutdown of Chengda Hongsheng, and reduced the operating rate of Baoming in Xinjiang. After experiencing the pain of business restructuring, the company was revived and went into battle lightly. Operating pressure was released, the shale oil project was exhausted, and valuation repairs can be expected. Shareholders actively participated in the acquisition of China Insurance and fixed the increase in issuance. The company issued additional purchases of high-quality insurance assets (China Insurance has obtained a new life insurance license, and its profitability and market share rank among the highest in the industry). The company integrates the resources of the two major industries of securities and insurance to achieve a high degree of financial synergy, and there is huge room for imagination in the future. At the same time, shareholders actively participated in fixed increases, and their holding position increased markedly, reflecting their high recognition of overall future profitability and sending a strong signal. At the same time, the company introduced new shareholders to inject new vitality. We use a segmented valuation method to maintain the company's target price of 23.26 yuan and maintain the buying rating.