Key investment points: Decline in performance in the first half of the year The company released its 2016 semi-annual report. The first half of the year achieved operating income of 1,217 billion yuan, a year-on-year decrease of 15.12%, and realized net profit attributable to shareholders of listed companies of 243 million yuan, a year-on-year decline of 22.25%, and achieved earnings of 0.44 yuan per share. The profit of the traditional thermoelectric business is affected by the reduction in electricity prices. Currently, the company's main source of profit contribution is still the thermoelectric business, and the Liangcun thermal power unit continues to rank first in the Hebei South Grid in terms of the number of hours used. The company continues to rank first among group companies in terms of relative hourly value of thermal power utilization and relative value of marginal revenue. The unit price of the company's comprehensive standard coal fired decreased by 19.33% year on year, and coal consumption for electricity supply decreased by 3.8 grams/kilowatt-hour year on year. In terms of prices, both heat and electricity prices in Hebei Province were lowered in 2016, which had a certain impact on the company, while the low rise in upstream coal prices in the first half of the year also put some pressure on the cost side. The Transformational New Energy Integrated Carrier Company proposed a strategic plan for “transformation from traditional power generation to integrated smart energy”. Since 2015, many new energy power generation projects have been rapidly deployed across the country. In 2015, the utilization rate of photovoltaic power plants ranked first among group companies, and the number of hours used by photovoltaic power plants all exceeded the design value. Currently, the company has connected to the grid and is currently constructing more than 300MW of photovoltaic projects and nearly 1GW of proposed wind power projects. At the same time, the company established Hebei Liangneng Electricity Sales Co., Ltd. in July, with a registered capital of 201 million yuan, targeting the electricity reform business in the Beijing-Tianjin-Hebei region. The company has the advantage of heating customers, mostly large industrial enterprises, and high electricity consumption. In the future, as the electricity sales business gradually matures, it is expected to create another profit growth point. Asset injection is gradually getting closer. The company has been established as an asset integration platform for China Power Investment's Hebei platform. In 2013, China Power Investment Group made a commitment to “gradually inject eligible thermoelectricity-related assets and other high-quality assets into the Hebei region.” At the end of 2015, China Power Investment Hebei Company had an installed capacity of 1.4212 million kilowatts of electricity, accounting for 39.55% of the installed capacity of new energy, making it the largest photovoltaic power generation enterprise in Hebei Province. We believe that the Hebei Company's asset injection into Dongfang Energy is highly certain, and that the entire China Power Investment Group's national reform process continues to advance, and Dongfang Energy is just around the corner as the China Power Investment Group's clean energy capital platform for the Beijing-Tianjin-Hebei region. We are optimistic about the direction of the company's transformation. The second half of the year will be a critical stage for state-owned enterprise reform to enter the deep-water zone. China Power Investment Group, as the enterprise with the lowest asset securitization rate among the five major power generation groups, has unlimited potential, and the company has better performance and stock price flexibility regardless of market value or industry scale. Currently, prices are still inverted compared to last year's additional price, keeping the company's profit forecast and purchase rating unchanged.