Investment points: Huacheng Securities Curve listing. The company's Internet layout is mainly reflected in the internetization of traditional securities business and the creation of a private equity fund service platform. Non-standard business is a characteristic of the company, and it is a major investment bank in the broad sense of the word. Introduce equity incentives to activate the vitality of brokerage firms. The target price is 19.80 yuan, the market capitalization is small, the flexibility is high, and the “buy” rating is maintained. [Event] Baoshuo Co., Ltd. achieved operating income of 434 million yuan in the first quarter of 2017, an increase of 540% over the previous year; net profit of 50 million yuan, an increase of 584% over the previous year, corresponding to an EPS of 0.03 yuan. In January-January, Huacheng Securities achieved a cumulative operating income of 345 million yuan and net profit of 68 million yuan for the parent company, which is the main source of performance for listed companies. After Huacheng Securities increased its capital and expanded its shares, the capital-consuming business received financial support. The interest income of Baoshuo shares mainly comes from the interest income of Huacheng Securities. Interest income was 132 million yuan in the first quarter. After the company's capital increase and stock expansion, the company's capital consuming businesses, such as securities financing and stock pledge business, received financial support, and it is expected that they will continue to grow on a large scale. At the end of the first quarter, the company had a market share of 1,714 billion yuan, an increase of 6% over the beginning of the year, with a market share of 0.2%; at the end of the first quarter, the market value balance of shares pending repurchase was 28.1 billion yuan, up 35.1% from the beginning of the year. Traditional business remains stable, and ABS underwriting has advantages. The company achieved net revenue from handling fees and commissions (brokerage, investment banking, asset management) of $212 million in the first quarter. We expect investment banks to achieve $0.8 billion in revenue in the first quarter. Three stock underwriting projects were completed in the first quarter, raising 3.474 billion yuan, including 1 IPO, raising 294 million yuan, and 1 additional financing, raising 1,480 million yuan. In the first quarter, bond underwriting raised 1,855 billion yuan, mainly ABS. The company's brokerage business remained stable, with a brokerage share of 0.23% in the first quarter, which is basically the same as last year, and is expected to achieve brokerage revenue of 120 million yuan. Actively lay out non-standard business and become a major investment bank in the broad sense of the word. Two major local exchanges+internet financial platforms = large investment banks in the broad sense of the word. The company actively lays out non-standard business. Through Jinhui Capital, it holds 40% of the shares in the Guizhou Liquor Exchange and indirectly controls the Guizhou Equity Financial Asset Exchange Center to achieve a combination of investment and financing, comprehensively open up asset management business and investment business, and get involved in a broad range of major investment businesses. A number of non-standard products designed by the company had excellent sales scale and earnings performance on its Jinhui Financial Platform, opening up the entire business chain investment banking model. Introduce equity incentives to activate the vitality of brokerage firms. The company's equity structure is scattered, and it is the only brokerage firm in the industry that has introduced an employee stock ownership plan. The total amount of shares held by employees of the four major platforms before supporting capital raising in the fourth quarter of '16 was 4.99%. The total share after ancillary fund-raising was 2.08%. The company still plans to carry out employee stock ownership plans in the future. [Investment advice] The 2017 EPS of Baoshuo shares is expected to be 0.62 yuan. Using the segmented valuation method, the target price was 19.80 yuan, corresponding to 2017 EP/E 31.8x, corresponding to 2017 EP/B2.17x, maintaining the “buy” rating. Risk warning: The market continues to be sluggish, and market supervision has been further strengthened.