This report is read as follows:

The company has obvious advantages in the card position in the agricultural market, but the profit growth has been limited in the past two years for reasons such as the trapped mechanism and the pace of expansion. 2016 is the window for the change of the board of directors, and it is worth paying attention to whether it can be straightened out through the reform of the mechanism.

Main points of investment:

Investment suggestions: Shenzhen and Shenzhen state-owned enterprise reform benefits, 2016 of the board of directors change the window, whether through the reform to achieve incentive improvement is worthy of attention. The company's asset value is significant, the agricultural batch market business layout is leading, the future industrial integration space is huge and the entry threshold is high. Because of its large scale and mostly B2B transactions, it is an excellent hotbed of supply chain finance. 5.19 will usher in the change of the board of directors, taking into account the impact of heavy asset expansion and cold storage demolition and other effects, downgrade the 2016-2017 EPS forecast to 0.02max 0.03 (originally 0.05max 0.07), give the 2018 forecast 0.04 yuan, with reference to the current industry average PB valuation (about 6X), lower the target price to 16 yuan to maintain the increase.

Annual report operating low expectations, quarterly report year-on-year turnround, financial pressure and other constraints to improve performance. In 2015, revenue / net profit increased by 5.4% gamble 75.6% over the same period last year, mainly affected by the demolition of cold storage in Phuket market and the reduction of agricultural processing business in 2014. At present, the company has laid out 40 agricultural logistics park projects, but the rapid expansion and heavy assets have also led to a sharp increase in financial pressure, with short-term / long-term loans growing to 1.37 billion in 2015 compared with the same period last year (originally 27.8 in 2014). This led to a 201 million increase in financial costs (132 million in 2014). Affected by the superimposed effects of the recognized income of shops in Guangxi, the increase in investment income of Elephant Venture Capital and the withdrawal and consolidation of Haiji Star, 1Q16's revenue increased by 27.3% compared with the same period last year, achieving a net profit of 4.11 million (- 5.49 million in the same period of 2015).

The dispute over equity is temporarily cold, and the window for the change of the board of directors pays attention to the progress of the reform. Recently, the market attention of the reform of state-owned enterprises in Shenzhen has increased, and agricultural products, as an important platform of state-owned assets, are expected to benefit first. 5.19 will usher in the window of the board of directors. At present, the company owns nearly 1000 million square meters of land, and the actual controller, Shenzhen State Asset, and the second shareholder Life Life share are only 2% less. Once the reform drives the mechanism to be straightened out, the company will usher in the improvement of operating efficiency and the return of asset value. CPI is expected to rise moderately in 2016, and the company is expected to benefit from the implementation of agriculture and agricultural products-related policies.

Catalyst: progress in the reform of state-owned enterprises; release of macro-policy dividends on agricultural products; risk hints: the economy remains in the doldrums; the progress of state-owned enterprise reform is lower than expected.