Incidents On August 27, 2016, the company issued an interim report. In the first half of the year, it achieved revenue of $3.51 billion, an increase of 65.5% over the previous year, and realized net profit attributable to shareholders of listed companies of 260 million yuan, a decrease of 3.6% over the previous year. Key points of analysis: performance was stable, and gross margin clearly rebounded: in the first half of the year, the company's operating profit increased 73.5% year on year, but net profit decreased slightly year on year. The first reason is the sharp decrease in investment income from $270 million in the same period last year to $0.6 billion in the current period. The second reason is the sharp increase in income tax expenses, from $0.1 million in the same period last year to $220 million in the current period. Furthermore, financial expenses during the reporting period increased from $03 million in the same period last year to $200 million, mainly due to increased interest that cannot be capitalized. Positive factors include a sharp reduction in asset impairment losses of 98.9% (the latest market price overtook preparations for inventory price declines calculated in the previous year), a 566.4% increase in net cash flow from operating activities (a significant year-on-year increase in sales payback), and a marked recovery in gross sales margin (from 20.0% in the same period last year to 31.6% in the current period). Sales increased steadily and unit prices rose sharply: In the first half of this year, the company achieved a sales area of 151,000 square meters, a year-on-year decrease of 2.6%, and a sales amount of 2.09 billion yuan (according to Kerry statistics), a year-on-year increase of 17.9%. The average sales price rose sharply in the first half of the year, from 11,462 yuan per square meter in the same period last year to 15,650 yuan per square meter. The growth rate was as high as 36.5%, mainly due to the good price coordination between Shanghai and Ningbo regions. The financing movement was obvious, and the overall debt ratio declined steadily: according to the company announcement, from January 1, 2016 to August 24, 2016, the company added a total of 5.27 billion dollars in loans, including bank loans of about 360 million, issuance of bonds of 2.5 billion yuan, and other loans of about 2.41 billion dollars. The company made full use of the financing environment to improve the debt structure and create positive conditions for the company's strategic transformation. It is worth noting that the company's overall debt ratio has maintained a steady downward trend. The balance ratio at the end of the first half of the year was 77.1%, down 3.2 percentage points from the previous year. Leveraging the Group's integrated resource advantages to achieve strategic transformation: The company signed a framework agreement with the Ningbo Free Trade Zone Management Committee in September last year to begin deploying cross-border e-commerce. In March of this year, the company announced plans to acquire ARC Group assets indirectly held by the group (a well-known global hybrid gas generator company) and intervene in the automotive safety sector by means of fixed increases. In June of this year, companies under the Yinyi Group plan to acquire 100% of the shares of Belgian Bunche (the world's leading manufacturer of CVT transmissions), and the subsequent strategic transformation is expected to accelerate. The investment proposal predicts that the company's 2016 EPS is 0.27 yuan. The current stock price corresponds to 42x16PE, maintaining an increase in holdings rating. Risks suggest that real estate sales are falling short of expectations and that asset injection is progressing slowly.