Investment highlights 2015 business review: revenue/profit increased by 13.35%/8.72%; excluding the acquisition of Zhentai affected the increase in revenue by 3.32%, and profit decreased by 13.42%. In 2015, the company achieved operating income of 1,067 million yuan, an increase of 13.35%; net profit of 77.574 million yuan, an increase of 8.72%, and an EPS of 0.15 yuan, an increase of 7.14%. Among them, 2015 Q4 achieved revenue of 365 million yuan, an increase of 29.66%, and net profit of 22.3472 million yuan, an increase of 413.17%. The obvious month-on-month improvement in H2 performance was mainly due to Zhentai's merger. The gross profit of rice wine was 49.11%, up 0.8 pcts. In terms of cost ratio, the sales expense ratio was 18.97%, down 0.99 pcts; the management expense ratio was 17.11%, which was basically the same; and the comprehensive net profit margin was 6.60%, down 0.47pcts. By region, foreign port revenue accounted for 19.29%, an increase of 8.78 pcts; gross profit was 31.39%, a sharp increase of 15.06 pcts. In 2015, the company sold 110,000 tons of rice wine and kept 210,000 tons in stock, with sales volume increasing by 14.26%. During the reporting period, the company acquired 100% of the shares of Wuxi Zhentai Liquor with its own capital of 300 million yuan to expand the regional layout of rice wine through extension. 2015H2 Zhentai achieved revenue of 94.3811 million yuan and net profit of 15.7944 million yuan, accounting for 20.36% of the company's net profit in 2015. Excluding Zhentai's merger, revenue from the original main business increased by 3.32%, and net profit fell 13.42%. The profit distribution plan for 2015 is 0.5 yuan (tax included) for every 10 shares, with a dividend rate of 33.17%. Stable rice wine: diverse brands and clear market positioning; based in Shanghai, building a cross-regional layout between Jiangsu, Zhejiang, and Shanghai. The company's rice wine brands are diverse, and the target customer base is clear: the “Shikumen” brand focuses on the high-end; the “Golden Age” brand targets young fashionistas; and “He” wine targets the public and positions the middle end. In 2015, the company's rice wine business revenue reached 1,049 billion yuan, and the sales volume of the core brand “Shikumen” series increased 17% year on year; the sales volume of the “Golden Years” series increased 6% year on year, and the share of high-end products reached 64.38%, which became the main driving force for growth. Furthermore, the company has increased brand and consumer investment, reduced channel subsidies, and promoted the integration of production capacity in the three regions to reduce costs. In terms of channels, the company's products account for more than 50% of the Shanghai supermarket channel market, effectively utilize more than 3,000 chain stores under **** Group, and establish a core terminal management team, covering 15,000 catering terminals. Using Shanghai as a foundation, we promote the consolidation of the city, recover suburban counties, and expand outside the city, build suburban markets and markets outside the city, such as Jiading in Shanghai, Qidong in Jiangsu, and Haimen, Jiangsu, etc., and cultivate 5 million sales markets such as Yancheng, Nantong, and Nanjing in Jiangsu. Multi-wine platform: Use e-commerce channels to increase wine business expansion, while also developing cooking wine to create a multi-wine business pattern. The company launched “Meisheng Family” wine. Meisheng Family is a French brand, and Jinfeng Liquor is the brand operator and holder. It pioneered the drinking fashion of 187ml small bottles of wine, focusing on leading drinking methods and social trends, using precise communication ideas, and relying on e-commerce channels to enter the fastest-growing imported wine market. In 2015, it won first place in “Double Eleven” imported wine sales and the top three e-commerce imported wine category transactions. In terms of cooking wine, a “bold” brand was launched to enter the booming condiment market. In 2015, the company's revenue other than rice wine was 12.7 million yuan, which is still small. risk factors. The pace of new business development fell short of expectations, and the industry boom fell short of expectations. Earnings forecasts, valuations and investment ratings. The company's rice wine business is stable. It is expanding the regional market through mergers and acquisitions, while actively seeking development platforms for various types of wine such as imported wine and cooking wine. Attention can also be paid to ****'s state-owned enterprise reform and the possibility of continued integration of the rice wine industry. The 2016-2018 EPS forecast was slightly lowered to 0.17/0.18/0.19 yuan (the original 2016/2017 EPS forecast was 0.18/0.20 yuan; 2018 was an additional forecast), maintaining the “increase in holdings” rating.