This report is read as follows:

After Tencent, the company once again reached a strategic cooperation with Tmall of Ali system. Under the background of warming up reform, the company's transformation landing and resource integration ability can be called strong, and the market is still digesting the direction and progress of the company's transformation. Optimistic about the follow-up progress, it is recommended to increase the holdings.

Main points of investment:

Investment suggestion: the company's investment opportunities in this round come from the heating up of regional reform and the intensification of strategic transformation. Alliances with Internet giants such as Tencent and BABA have fully proved the ability of transformation and resource integration. Optimistic about the follow-up reform and the progress of the transformation to an intelligent experiential content operation platform, with a target price of 20 yuan, to maintain "increased holdings". The framework of the venture capital production line of Tencent + Saige + BABA has been completed, and it is expected to continue to enrich the content operation platform, and Shenzhen, the capital of hard creation, is expected to continue to enjoy policy and industrial dividends. Seg as an important state-owned information technology platform for follow-up transformation is promising. Under the reform environment, the cooperation with Internet giants may be deepened in the future, and it is optimistic that based on the premise of complementary resources, the 2016-2018EPS forecast will remain unchanged at 0.12, 0.15 and 0.18 yuan.

Tencent and BABA after the alliance, long-term cooperative relationship is expected to deepen. Tmall platform will open cost-effective ports to support Sail venture capital products and their own product recommendations, and provide offline marketing support through the "Juchuang Global" Internet intelligent acceleration tunnel, and each other's preferred business support partners to share media and other resources. Tmall Juhuasuan is currently the largest "popular style" platform in China, and it will provide strong channel support for Saige venture capital and self-owned products (such as smart home, etc.). On the basis of long-term cooperation, the two sides will take the opportunity to explore the next step of cooperation, coupled with Taobao China, which has previously reached a framework agreement, the follow-up cooperation between the company and Ali will be more comprehensive.

The direction of the transformation is clear, and the market's understanding of its determination and progress needs to be strengthened. The company is committed to the transformation from property rental to high-tech + experiential content operation platform, and actively transform the creators' ecology, culture and education, intelligent technology, sports and entertainment, virtual experience, e-sports games and other fields (some areas may go deep into the industrial chain). And with Tencent, BABA, Internet fish Internet cafes and other industry leaders reached strategic cooperation. In the context of the heating up of regional reform, the company's determination and implementation of transformation has begun to show its edge, and it is expected that the existing cooperation will be deepened and extended to other areas of transformation in the future.

Catalyst: reform of state-owned enterprises in Shenzhen is heating up; asset restructuring plan is approved

Risk hints: the reform cycle is long and the asset reorganization is uncertain.