Key investment events: The company released its 2016 three-quarter report. Comment: The company's performance is growing rapidly. 1) The company achieved revenue of 397 million yuan in 16Q3, up 102.52% year on year; realized net profit of 87.09 million yuan, up 206.70% year on year; total revenue from January to September was 810 million yuan, up 30.38% year on year; net profit was 133 million yuan, up 65.45% year on year; 2) The company's net profit in 2016 is expected to be between 223 million and 293 million yuan, up 60%-110% year on year. Sales and management expense ratios have risen and fallen, and financial expenses have increased dramatically. 1) In January-September, the sales expense ratio fell from 7.67% to 5.11%, and the management fee rate increased from 8.28% to 11.21%. The overall cost rate did not change much after one increase and one decrease. 2) Financial expenses increased from $22.47 million to $57.3 million, mainly due to interest accrued on additional loans and bond issues in the current period. The path of mergers and acquisitions centered around big cultural strategies continues to move forward. Company Q3 plans to acquire 90% of the shares of Aurora Network, a page game company, by way of equity+cash (at a price of 668 million yuan); and recently acquired 3% of Qishu Youyu's shares with 10.5 million yuan in cash (mainly engaged in online movies). Continued extended acquisitions confirm our previous judgment, and we expect the company to continue to invest more around a big culture strategy. Profit forecast and rating: The company's net profit for 2016/17/18 was 248/4.41/506 million yuan respectively, fully diluted EPS was 0.31/0.54/0.62 yuan, and the current stock price corresponding to PE is 60/34/29 times, respectively. We expect that the company's investment in the fields of film and television/music/games/literature/education may continue to increase in the future, and that multi-business linkage will continue to improve. Therefore, there is still a lot of room for the company to improve its future performance, and it will continue to maintain the “increase in holdings” rating. Risk warning: The acquisition fell short of expectations, the manufacturing business continued to decline, and competition in the cultural sector intensified.