Investment highlights: Germany and the US got rid of the burden, order growth was good, and profit returned to normal in 2015. The company achieved revenue of 1,856 billion yuan in 2015, a year-on-year decrease of 4.6%; net profit (attributable to shareholders of listed companies) was 143 million yuan, up 381.0% year on year; net profit after deducting non-return net profit of 139 million yuan, an increase of 73.8% year-on-year; and a combined EPS of 0.21 yuan, in line with our expectations, was -131 million yuan in non-recurring profit and loss in 2014, mainly due to losses from Zhejiang Germany and the US in 14Q4. In 2015, the company got rid of the burden of Zhejiang Germany and the US. At the same time, cigarette label orders grew well, and profitability returned to normal. Cost control is effective, profit levels have recovered, and net profit in 16Q1 increased 200% year over year. In 16Q1, we achieved revenue of 364 million yuan, an increase of 9.5% year on year; net profit of 22.3635 million yuan, an increase of 200.1% year on year; net profit after deducting 2199,700 yuan, an increase of 208.4% year on year, in line with our expectations. The company expects net profit of 4390.56-56.819 million yuan from January to June 2016, with a year-on-year change range of -15% -10%. The company's main cigarette label business is on the right track. Orders are growing well, while various costs and expenses are being reasonably controlled. Under the premise of a 9.5% increase in revenue in 16Q1, operating costs only increased by 2.7%, and the share of sales revenue decreased by 4.64 percentage points to 69.6% year on year. As a result, profit levels rose sharply. 16Q1 gross margin increased 4.64 percentage points year over year to 30.4% year on year; net profit margin increased 3.26 percentage points year over year to 5.5% year on year. The holding subsidiary Sanyu Network plans to establish a joint venture with the China Tobacco New Business League to expand e-commerce platforms for non-tobacco products and services. Zhejiang Sanyu Network Technology Co., Ltd. (80% of shares), a holding subsidiary of the company, plans to negotiate cooperation with Xinshangmeng E-Commerce Co., Ltd., and the two sides will jointly fund the establishment of a project company (the investment of Sanyu Network does not exceed 50 million yuan, accounting for no more than 49%), and use the project company to carry out B2B (business-to-customer connection), electronic advertising, and microfinance loans (for Chinese tobacco terminal customers). The New Business League was jointly invested and formed by China Tobacco Group and Zhejiang University Wangxin Group. The “New Cloud Online E-Commerce Platform” uses the O2O model to build and operate a modern e-commerce platform for non-tobacco products based on more than 5.6 million Chinese tobacco retail terminals to provide retail terminals and consumers with online procurement of non-tobacco products, including convenient payment (telephone bills, cable TV, water, electricity, gas, traffic tickets, etc.), Internet virtual products (Internet lottery, game points, QQ points, etc.), express delivery (Internet e-commerce self-pickup points), express delivery (Internet e-commerce self-pickup points), Will continue to develop air tickets/popularity Ticket sales, insurance sales, internet photo printing, travel product sales, etc. increase the customer stickiness and profitability of tobacco shops. Traditional tobacco label business endogenous growth+extended mergers and acquisitions, effective development of overseas markets, and active expansion of diversified business layouts. Order growth in the company's main tobacco label business resumed in 2015, and profitability continued to rise. In 2014, the company obtained the British and American tobacco supply system certification and entered the Japanese Tobacco International Supply Chain System, reflecting the strong competitive strength of the company's products, which is also conducive to expanding more overseas markets in the future. Since its listing, the company has continued to achieve rapid development through extended acquisitions (Eusgide, Jiangyin Teruida, Fujian Taixing). In 2015, it acquired 60% of the shares in Yuxi, Yunnan, 56% of Qujing Fupai, and 26% of Dali Meidon's shares, and acquired the remaining 15% of Fujian Taixing's shares with its own capital. In addition, the company is actively expanding into fields such as e-cigarettes, cloud printing, and intelligent robots, and signed a general distribution agreement for the exclusive operation of Fibre Form Packaging in China (including Hong Kong) and non-exclusive distribution rights in Taiwan for domestic customers in Taiwan, expanding the new packaging materials business, and actively expanding its diversified business layout. Traditional businesses continue to expand, and new businesses enhance potential profit margins. It is expected that the company's transformation will continue to advance. In the traditional cigarette pack business, the company used continuous external acquisitions to increase market share and expand into the downstream printing sector. In terms of new business development, diversified layout in the fields of e-cigarette business, cloud printing, intelligent robots, new material packaging, and 5.6 million tobacco terminal value-added service markets, etc., considering acquisitions and volume increases and dilution, maintaining the company's net profit forecasts of 230 million yuan and 288 million yuan in 16-17, corresponding to EPS of 0.29 yuan and 0.37 yuan (0.33 yuan and 0.41 yuan before dilution), respectively. The current stock price (9.00 yuan) corresponds to PE 31 times and 24 times in 16-17, with fixed price increases of 8.16 yuan/share, respectively The average price increase of 11.61 yuan/share with previous executives provides a certain margin of safety. At the same time, it is expected that the company's transformation will continue to advance and maintain the increase in holdings!