Event: The company released its 2016 Quarterly Report 2016 Quarterly Report. The company achieved operating income of 331 million yuan, a year-on-year decrease of 12.24%; realized net profit of 31.52 million yuan, a year-on-year decrease of 18.46%; realized net profit after deduction of 28.48 million yuan, a year-on-year decrease of 19.35%; and achieved basic earnings per share of 0.05 yuan. Removing inventory from traditional products affects performance. Among the core products that are expected to improve in the second quarter, antiviral oral liquid and pentane root granules are affected by inventory removal factors. It is expected that there will still be a decline in the first quarter, and performance is expected to recover after inventory removal in the second quarter. The winning bid price for the Orange and Red series continues to grow rapidly, and channel coverage deepens. The growth rate is expected to be close to 25% for the full year of 2015. The transformation factors of the tablet workshop were eliminated, and the merger and acquisition in Tianji, Hubei was completed ① The tablet business was affected by GMP workshop transformation and the general environment of the industry in 2015. The annual growth rate was both low and high. The annual revenue for 2015 was 395 million yuan, an increase of 15.37% over the previous year. The growth rate for the first quarter of 2016 is expected to be slightly higher than for the whole of last year. ② The M&A of the Outreach Company was completed in Tianji. Tianji promised that net profit after deduction for the three years from 2016 to 2018 would not be less than 47.5 million yuan, 52.25 million yuan, and 57.475 million yuan. By exceeding 30% of the performance portion, Xiangxue will incentivize the management team and help ensure growth under the pressure of performance promises and the motivation of performance incentives. The second phase of the TCR project has begun. A number of ongoing research projects are progressing in an orderly manner. The first phase of TCR was completed in 2015. The second phase plans to enroll 36 cases and carry out research on the two symptoms of NSCLC and lung cancer. For other research projects, the small nucleic acid cotranil has already entered the rapid review channel of the Drug Evaluation Center; the antiviral oral solution has obtained a natural health product certificate issued by Health Canada and has obtained mature market entry qualifications; and pandan root has obtained drug registration applications in the UK for acceptance. Overseas registration of major products will help win domestic bids and overseas sales in the long run, and open up new market space. The 16-18 performance is expected to be 0.42 yuan/share, 0.50 yuan/share, and 0.57 yuan/share, respectively. The company's traditional business endogenous improvement, the tablet extension industry integration, and TCR technology is comparable to international leaders. We expect the company's 16/17/18 EPS to reach 0.42/0.50/0.57 yuan (2015 EPS is 0.27 yuan). The current stock price corresponds to PE36/34/30 times, maintaining the “buy” rating. Risk indicates that the progress of drug development is low and that the progress of drug development is low; the risk of merger and acquisition integration;