Key points: We recently organized Huangshan tourism research and conducted in-depth exchanges with company management and hotel business management. The main points are as follows: The passenger flow will continue to improve over the next two years. Judging from the passenger flow history of the past 15 years, the Huangshan Scenic Area has never experienced a decline in passenger traffic for two consecutive years. Passenger flow declined in 2016 due to rainy weather, so we expect a likely reversal in passenger flow in 2017. However, the opening of the Hangzhou-Huang high-speed railway in 2018 will bring qualitative changes to the development of the scenic area. One of the major bottlenecks in Huangshan's development is transportation. Currently, most visitors still come to the scenic area by bus, limiting the growth of individual visitors and high-end visitors. The passage of the east-west high-speed rail will bring the scenic area into the four-hour traffic circle of Jiangsu, Zhejiang, and Shanghai. The entire company has high expectations for the Hangzhou-Huang high-speed railway. Market-based reforms have been very effective: 1) The company has leased and operated mountain hotels, including Huangshan Hotel and Yungu Mountain Resort, which have lost money all year round, and Huangshan International Hotel has also successfully turned losses into profits. Yamashita Hotel has historically lost 30 to 40 million yuan a year, and is expected to reduce losses close to 10 million yuan this year. 2) Shanshang Hotel carries out revenue management, develops in the direction of boutique hotels, increases room prices (ADR), reduces occupancy rates (OCC), and achieves an increase in profit margins while ensuring the growth of RevPar. At the same time, it also encourages more visitors to stay in the mountains and increases the occupancy rate of Yamashita Hotels. Moreover, the current pricing of Mountain Hotel is set at the beginning of each year, so there is limited room for adjustment. In the future, a more market-based and flexible pricing strategy will be adopted, and prices can be adjusted in real time. 3) The company actively cooperates with market-based institutions. This year, it signed strategic cooperation agreements with many companies such as Xiangyuan Holdings, Hanyuan Capital, and Scenic Culture. 4) In the future, it is expected that a more flexible market-based incentive system will be adopted at the subsidiary level. The new management's momentum for market value management has increased markedly. Since the new management took office in 2016, the company's government and enterprise were separated for the first time (the new president did not also serve on the Huangshan Management Committee), and more attention was paid to using the listed company platform to achieve external expansion. Recently, the company has continuously launched two expansion projects in Taiping Lake and Hongcun, and its execution has increased markedly compared to the past. The epitaxial expansion project is expected to directly increase the company's performance (in 2015, ticket revenue for Hongcun Scenic Area alone reached 110 million yuan; there is an opportunity to hold shares in the future), while also increasing the company's demand for refinancing. It is recommended to maintain the recommended rating for Huangshan Tourism's A/B shares. The target price for A shares is 20.49 yuan, and the target price for B shares is 1.96 US dollars. Risky weather causes have a negative impact on passenger flow; the performance of projects with extended expansion falls short of expectations; and potential future refinancing actions dilute earnings per share.