Main points of investment:

The company's equity incentive plan has been adopted at the shareholders' meeting on November 21, this time the stock option incentive is strong and the equity incentive cost is related to the stock price on the date of grant. At present, the stock price corresponds to the cost amortization pressure of equity incentives in 2017, which forms a certain pressure on achieving the performance exercise conditions in 2017. Due to the impact of equity incentive costs and new shares, we slightly adjust the company's 2016-2018 EPS to 0.30Unix 0.30max 0.34 yuan (adjustment-0.01Universe 0.01Compact 0.01) to maintain the "overweight" rating, with a target price of 24.91 yuan.

The equity incentive is strong and the cost is high, which has a certain pressure on the conditions for the exercise of performance in 2017. The number of stock options is no more than 13.7 million, with a total value of 232 million yuan based on the exercise price of 16.93 yuan per share. Strong equity incentive and high exercise price (relative to the closing price of 16.8 yuan / share premium the day before the announcement of the draft equity incentive) highlight confidence in the future development of the company and at the same time bring relatively high management costs. We assume that with November 28 as the award date, the total cost of this equity incentive is 36.85 million yuan, of which the amortized cost in 2017 is 25.05 million yuan, equivalent to 37.8% of the company's net profit in 2015. this has put some pressure on the company to achieve the performance exercise conditions for 2017 (compared with the same period in 2015). The equity incentive plan has been approved by the shareholders' meeting and still needs to be confirmed on the date of grant.

Fixed increase landing + equity incentive to promote the company to achieve great-leap-forward development. The company's first capital market refinancing has been settled, and the first stock option incentive has been approved by the shareholders' meeting. The company has begun to strengthen the use of this capital platform of listed companies, and in the future, it is expected to achieve great-leap-forward development with the help of the external high-quality assets of major shareholders (Tongrun auto parts + Tongrun drive equipment) + high equity share (54.62%).

Catalyst: confirmation of equity incentive grant date; expected promotion of asset securitization or extension.

Core risk: asset securitization or extension expansion is blocked.