Matters: The company issued a draft restricted equity incentive. The number of restricted shares to be granted is 2,081 million shares, and the total number of incentive recipients is 72. Our comments on this are as follows. Comment: Implement an equity incentive plan and bind the core team. The incentives cover a total of 72 people in the company's core management and business and technical cadres, which is conducive to maintaining the stability of the core team and enhancing the initiative to increase performance growth. Restricted stocks are unlocked over three years. The conditions for unlocking are that net profit from 2016 to 2018 was not less than 7200/9360/121.68 million yuan, respectively, corresponding to a compound annual growth rate of not less than 30%. The equity incentive fee is amortized over four years, and the expected increase in the company's performance will be far greater than the impact of the increase in expenses. In September, the actual controller of the company took the initiative to increase the company's shares by 5,600,000 shares, at an average cost of about 19 yuan, demonstrating confidence in the company's future development. The performance greatly exceeded market expectations, and the company entered an upward channel. The company reported a sharp increase in revenue in the third quarter, and the net profit was reversed. The core was the effect of strategic transformation and business optimization, mainly from three aspects: 1. The revenue from the operator business and mobile game business grew steadily, with a significant year-on-year increase in gross margin; 2. The mobile resale business of integrated WiFi, mobile phone traffic, and corporate SMS grew rapidly, and revenue increased dramatically; 3. The investment promotion work of Beiwei International Center has been successfully carried out, and the occupancy rate has reached 60%, which is expected to exceed the guidelines throughout the year. The company focuses on the “information service integrator” strategy and optimizes the business line to see initial results. The company predicts that it will achieve net profit of 72-80 million yuan for the full year of 2016. Communications and information services are expected to grow at an accelerated pace. The company has made a strong entry into the mobile Internet access business, with full coverage of WiFi and 3G/4G traffic management exclusively among A-share listed companies. WiFi resale time has accumulated over 10 million hours, accounting for the largest share of third parties. 3G/4G traffic has a high starting point, and the entire layout has a first-mover advantage, focusing on expanding Internet channels and customers in the financial industry. It is expected that traffic management will continue to contribute to incremental revenue. The company is already involved in the enterprise SMS business, forming a synergy with WiFi and traffic, and is expected to become a new performance growth point. Set up a mobile internet industry fund to lay out outreach expansion. The company signed an agreement with Ping An Financial Intelligence, Wonderful World, and Ping An Smart to jointly establish a mobile Internet industry investment merger and acquisition fund. The total size of the fund is estimated to be RMB 500 million, of which the company has pledged 150 million yuan. The company participated in the establishment of an industrial fund, and the transformation of mobile internet is expected to accelerate. The fund's investment direction covers communication solutions, intelligent hardware, and mobile internet services, such as video lottery cloud platforms, mobile games, etc. As the epitaxial layout progresses in an orderly manner, the company's new strategic direction is expected to gradually take shape. Risk factors: New business growth falls short of expectations, industrial fund investment risk. Maintaining a “buy” rating: The inflection point of the company's business development has been verified, equity incentives are tied to the core team, the epitaxial layout is conducive to speeding up the pace of transformation, and there is a margin of safety for most shareholders to increase their holdings. Maintain the company's 2016-2018 EPS forecast of 0.29/0.41/0.52 yuan. Considering the company's business reversal and extension expectations, 65X PE for 2017 was given, and the target price of 26 yuan and the “buy” rating was maintained.