1. Overview of the incident The company plans to invest 500 million yuan to establish a wholly-owned subsidiary in Zhuhai. Its main business is equity investment and investment management. 2. Analysis and judgment focus on shopping center positioning, and explore relevant investment projects. In recent years, companies have developed various business formats such as restaurants, entertainment, and community services around the positioning of community-based shopping centers, and have continued to expand experiential consumption, effectively coping with the diversion brought about by e-commerce. The establishment of a subsidiary in Zhuhai shows the company's determination to lay out upstream and downstream industries related to the main business of shopping centers. In the future, the company may invest more heavily in related business formats that can bring synergy to the main business, such as investing in experiential content such as “eat, drink, and play” to increase customer traffic and customer stickiness, strengthen core competitiveness, and improve the efficiency of the use of own capital. The CITIC Industrial Fund was introduced to strengthen high-quality equity investment companies and increase the proposed increase of 860 million yuan. After the fixed increase, CITIC Industrial Fund will indirectly hold 18.41% of the company's shares, making it the second largest shareholder. Previously, the company has successfully cooperated with CITIC Industrial Fund and invested in projects such as “Sing” and “Are You Hungry?”: 1) The introduction of “Sing” KTV physical stores will help stores attract more young consumers and increase customer stickiness; 2) Cooperation with the “Are You Hungry” mobile food service platform is beneficial to the company's experimentation with integrated online and offline development, providing more convenient catering services for residents around the community. It is expected that in the future, the company will continue to use the CITIC Industrial Fund's strong project resource advantages and financial advantages for the purpose of financial investment and strategic cooperation to explore high-quality project investment opportunities. The successful issuance of REITs and the gradual advancement of the asset-light strategy The company is gradually advancing the asset-light operation strategy. In response to the asset weight of shopping centers, the company issued BHG Retail Trusts (REITs) in Singapore in 2015, with a scale of approximately S$394 million. REITs hold shares in five shopping centers sold by the company. Currently, all shopping malls have opened, providing stable rental income. As the sponsor, trust share holder, fund manager and property manager of REITs, the company can obtain rich management income and trust income, while improving cash flow and optimizing the financial structure. In the future, the company may continue to sell mature properties to REITs and retain management rights, adopt models such as rent collection and management, and enjoy value-added property benefits and operation management benefits. 3. Profit Forecast and Investment Proposals The establishment of a subsidiary further demonstrates the company's determination to seek high-quality equity investment projects. After introducing the CITIC Industrial Fund with a fixed increase, the company is expected to take advantage of its project resources to accelerate the pace of foreign investment and cultivate new profit growth points. We are optimistic about the further advancement of the company's asset-light strategy. We expect the 2016-2018 EPS to be 0.16 yuan, 0.23 yuan, and 0.32 yuan, maintaining the “highly recommended” rating. 4. Risk warning: The macroeconomic downturn; the performance of equity investment targets falls short of expectations.