Investment highlights: The company's annual report is published. The company achieved total operating income of 1,078 billion yuan in 2015, down 29.91% from the same period last year. Net profit attributable to listed companies was 18.3593 million yuan, compared to 38,5271 million yuan in the same period last year. The company's gross sales margin fell from 26.46% in 2014 to 19.97%, while the sales expense ratio and management expense ratio increased compared to 2014. The decline in performance was affected by real estate de-inventory, revenue deferred confirmation, and subsidiaries' depreciation preparations: (1) In 2015, real estate industry de-inventoried. Intense market competition caused the company's gross margin to decline and sales and management expenses to rise. At the same time, competition in the building materials market caused the prices of the subsidiary's port and new materials to drop, leading to a sharp decline in performance; (2) the company's processing of some commercial housing projects slowed down, causing revenue deferral problems; (3) the company made major impairment preparations for the subsidiary Dacheng Renewable Energy. We believe that short-term accounting factors do not affect the long-term investment value of the company, and the company is expected to become a benchmark for the reform of state-owned enterprises in Jiangsu Province. The company has formulated a “one, two wings” strategic development to transform and upgrade to emerging industries. In a context where “classification regulation” will continue to be the main theme of the real estate industry, the company has set a strategic goal of “park operation and real estate as the base industry, and high technology, energy saving and environmental protection services as two wings” (that is, “two wings in one”) to promote the gradual transformation and upgrading of the company to emerging industries. The merger and acquisition of Ecco is a critical step in state-owned enterprise reform and industrial transformation. The company acquired 100% of Ecco's shares, taking a critical first step in state-owned enterprise reform and industrial transformation. Ecco Semiconductor is a leading manufacturer in the field of integrated circuit testing in China, and Ecco's testing business has a high level of gross margin. Semiconductors are currently a vigorously developed industry in the country, and the market space in the field of integrated circuit testing will grow rapidly! The military industry has achieved a breakthrough, and laser products are expected to become a new growth point. The Chinese University of Science and Technology has obtained a certification for the quality management system of weapons and equipment. At the same time, by strengthening research and development of laser processing technology and process improvement, 2016 is expected to become a new profit growth point for the company in the future. We are optimistic about the company's state-owned enterprise reform and industrial transformation, and maintain the “buy” rating. If we don't consider Ecco's merger for the time being, we forecast that the company's operating income for 16/17/18 will be 14.66/17.74/2.135 billion yuan, respectively, and the net profit attributable to listed companies will be 7.43/16.11/50.41 million yuan, respectively. If Ecco's merger factors are taken into account, according to performance promises, the company's net profit for 16/17 is estimated to be 9193/12061 million yuan, respectively, and the EPS after maximizing the share capital increase is about 0.15/0.20 yuan (the maximum number of additional shares issued may be 203 million shares). The company's strategic transformation trend is improving, and the integrated circuit testing industry is heavily supported by the government. There is huge room for further development in the integrated circuit field in the future. Furthermore, the holding subsidiary China University of Science and Technology is expected to achieve a breakthrough in the military industry business in Hong Kong. Integrated circuit+military industry is a strong driving force for the company's rapid development in the future. According to the valuation level of comparable companies, the valuation level is 150 times that of 16 years, corresponding to the target price of 22.5 yuan, maintaining the “buy” rating. Risk warning: short-term general market systemic risk; corporate transformation risk.