Key investment events: The company released its 2017 quarterly report: achieved revenue of 89.07 million yuan, an increase of 34.26% over the previous year, and realized net profit of 17.3 million yuan, an increase of 48.69% over the previous year. At the same time, it is predicted that the net profit attributable to shareholders of listed companies from January to June 2017 will change by 0-50%. Revenue continued to grow rapidly, and investment income and government subsidies increased profits. 1) The company's 17Q1 revenue increased by 34.3% year on year and maintained rapid growth (16Q4 +36%). Apart from the low base effect in the same period last year (8.4%), it was mainly due to the company's increased sales promotion efforts and the continued increase in sales of popular new products in the Rui series. 2) Increased investment income and government subsidies to increase company profits: The company increased investment income of 4.49 million yuan during the period, mainly due to the increase in revenue from the company's purchase of wealth management products; non-operating income of 869,000 yuan, mainly government subsidies, was 45,000 yuan in the same period last year. There was an increase in gross margin, and the continuous increase in brand promotion efforts led to a sharp increase in sales expenses: 1) The company's gross profit margin was 45.65% in the 17th quarter, an increase of 1 percentage point over the same period of the previous year; 2) the period expense ratio was 28.72%, a sharp increase of 5.8 percentage points over the same period of the previous year, mainly affected by the sharp increase in sales expenses. The company's sales expenses for the first quarter were 14.96 million yuan, an increase of 106% over the previous year, and the sales expense ratio increased by 5.9 percentage points. The company has increased its brand and product promotion efforts since the second half of the year, and continued to increase its efforts in the first quarter of this year, and has successively launched activities such as the Quality of Life Festival and CCTV advertising. We believe that during the traditional off-season of the industry, the company continues to launch brand marketing activities, laying a good start and foundation for sales promotion and brand marketing throughout the year. Having received 150 million yuan in advance payment from Evergrande, the construction business can be expected to expand rapidly: the amount received in advance at the end of the period was 162 million yuan, compared to 17 million yuan in the same period last year. The sharp increase in prepaid accounts mainly came from Evergrande's prepayment. The company previously signed a three-year 500 million order with Evergrande, and the delivery period began in April. The receipt of the advance payment indicates that the implementation of the project order is progressing smoothly. With the arrival of the peak renovation season, it is expected that the construction business will continue to expand in volume, driving the scale of revenue to continue to grow rapidly. In the future, the company will focus on first-tier real estate developers, continue to expand engineering business, and quickly seize market share. Plan first-time dealer shareholding plans, and benefit bundling to help channel expansion. Under the slowdown in performance growth in 2016, the company strengthened the optimization and improvement of the channel and dealer system, and the effects of diversified channel expansion gradually became apparent. The planning and promotion of the dealer's shareholding plan shows the dealer's confidence in the company's management and future development. We believe that achieving the binding of interests between the company and dealers through shareholding plans, while strengthening the operating momentum of dealers, is expected to further stimulate the potential of dealers and help the company's channels expand rapidly. Investment advice: The company is the leader and only listed company in the integrated ceiling industry. The effects of brand promotion, management optimization and channel adjustment over the past few years have gradually become apparent. Future multi-channel expansion and product category expansion will help the company once again embark on a path of rapid development. We expect the company's EPS in 2017-2019 to be 1.99, 2.68, and 3.37 yuan, respectively, and the corresponding PE is 31, 23, and 18 times, respectively. The company's current stock price is lower than the employee stock price (73.54 yuan) and fixed increase price (66.2 yuan). It has a high margin of safety and maintains a “buy” rating. Risk Warning: Real Estate Sales Decline Exceeded Expectations, New Business Expansion Fewer Than Expected