Key events in the report describe in the first half of 2016, the company achieved operating income of 2,429 billion yuan, a year-on-year decrease of 16.9%, net profit of 34 million yuan, a year-on-year decrease of 88.9%; a net profit margin of 1.41%, a year-on-year decrease of 9.15 percentage points, and an EPS of 0.02 yuan. Among them, the second quarter achieved quarterly operating income of 1,248 billion yuan, a year-on-year decrease of 29.04%, net profit of 033 million yuan, a year-on-year decrease of 86.44%; net profit margin of 2.65%, a year-on-year decrease of 11.21 percentage points, and an EPS of 0.02 yuan. Performance declined due to reduced carry-over of incident reviews, and the financial structure remained stable. As the company's carry-over area decreased by 21.88% year on year during the reporting period, and the price of raw copper in the enameled wire business fell year on year, the main business revenue decreased by 22.04%; or because of the carry-over project location, the gross margin of the main real estate business decreased by 17.31 percentage points year on year, resulting in an 88.90% year-on-year decrease in the company's overall net profit. The company's sales during the reporting period were impressive. The sales area and sales amount increased by 110.40% and 96.74%, respectively, over the same period, laying a good foundation for future performance. As of the end of the period, the company's balance ratio was 57.39%, the real debt ratio after deducting advance accounts was 48.52%, and the net debt ratio was 16%; monetary capital/ (short-term borrowings+long-term debt maturing within one year) was as high as 2.61. The company's financial structure was stable, liquidity was abundant, and solvency was strong. Equity incentives continue to advance to ensure long-term stable development. The first phase of the company's employee stock ownership plan has been implemented. The final exercise price is 6.11 yuan. The cumulative stock purchases account for 1.99% of the company's total share capital. During the reporting period, the company was promoting the second phase of the employee stock ownership plan. This time, the employee shareholding involved a total of 186 people, and the maximum subscription amount was 300 million yuan. The total number of shares held by employees this time accounted for 3.15%. If successfully implemented, the company's governance structure will be further improved, and at the same time, the long-term and effective incentive and restraint mechanism will be further improved to ensure the long-term and stable development of the company. The transformation continues to advance steadily. During the reporting period, the company continued to implement the transformation strategy around the business plan drawn up at the beginning of the year, and promoted the transformation of the new energy industry in an orderly manner. In the power lithium battery business, the company determined the technical route, introduced core technical personnel, and introduced 3 new production lines. It is expected that production can be put into operation in the second half of the year to expand market share. In terms of financial business, Fudian Bank, in which the company participated, implemented a profit distribution for the year 205, bringing the company 45 million investment income; the company's P2P platform has reached 371,000 users, with a cumulative turnover of more than 300 million yuan. In addition, medical subsidiaries are entering high-end anti-aging medical services through the acquisition of a Swiss project. Investment advice: We expect the company's EPS in 2016 and 2017 to be 0.20 and 0.26 yuan respectively, and the PE corresponding to the current stock price is 34.77 and 27.60 times, respectively, to maintain the “buy” rating. Risk warning: Policies are being tightened, carry-over falls short of expectations, and transformation is progressing slowly.