Revenue increased 1.79%, and net profit decreased by 33.65%. The company released its 2015 annual report. It achieved full-year revenue of 276 million yuan, a year-on-year increase of 1.79%, net profit of 129 million yuan, a year-on-year decrease of 33.65%, and an EPS of 0.28 yuan. Among them, 15Q4 achieved revenue of 63.212 million, a year-on-year increase of 49.99% (Q1-3: -17.84%, -5.72%, 0.05%, respectively); net profit was 1,536,700, a year-on-year decrease of 55.58% (Q1-3, year-on-year growth rates of -41.58%, -33.92%, and -13.21%, respectively). Revenue is growing steadily, and the hydropower sector has achieved good power generation efficiency. The decline in net profit is mainly due to: ① In 2015, the company no longer enjoyed the income tax loss policy and paid taxes at a 25% rate; ② The old-age+rehabilitation business is still in the industrial layout stage, and the upfront investment is large, making it difficult to generate profits in the short term. The main business, hydropower management, is steady, and the opening of the Changde & Xiangxi Branch can be expected. The annual report shows that the revenue of the hydropower sector was 275 million, an increase of 2.51% over the previous year. The installed capacity of the wholly-owned, controlled, and shareholder power stations reached 220,000 kilowatts. Zhuzhou Avionics, Bird's Nest, and Python Power completed feed-in capacity of 817 million, 56.564 million, and 299 million kilowatt-hours, respectively. At the same time, Kangnian Company made significant progress in the chain layout of rehabilitation medical institutions during the reporting period. It is expected that Changde and Xiangxi branches will open in 2016, which will lead to an increase in revenue at that time. Gross margin declined slightly, and net interest rate decreased by 24.99 percentage points due to an increase in income tax expenses. The annual report shows that the company's overall gross profit margin for the whole year was 57.90%, down 2.24 percentage points from the previous year. Among them, the gross profit margin of the main hydropower business was 58.01%, a year-on-year decrease of 1.79 percentage points, mainly affected by the low volume of water in the first half of the year. The cost control during the reporting period was reasonable. The cost rate for the period was 17.02%, a decrease of 6.24 percentage points over the previous year. Among them, the management fee rate was 11.65%, an increase of 1.09 percentage points over the previous year, mainly due to the increase in related expenses due to the completion of the Kangnian subsidiary and the Chunhua-Health City project; the financial expenses rate was 5.37%, a decrease of 7.33 percentage points over the previous year, mainly due to the repayment of some bank loans in the current period. The net interest rate for the current period was 46.08%, a decrease of 24.99 percentage points over the previous year, mainly due to the sharp increase in the income tax rate due to the fact that income tax losses were not enjoyed in 2015. The “two main and one auxiliary” pattern was initially formed, with “hydroelectricity+health and old-age care” as the main focus and equity investment as the supplement. First, it is the only listing platform under the state-owned holding group, and its main hydropower business has a good base. The largest shareholder of the company is Hunan Development Group, which has nearly 70 wholly-owned, holding, and shareholding enterprises under its management. Its business scope covers land, mining, hydropower, health care, health care, trade and logistics industries. The company is the only listing platform under the controlling shareholder, and has excellent resource endowments. With an excellent hydropower management team, the company's hydropower business performance is good, and hydropower asset management is continuously optimized. Second, based on the company's superior resources and Mr. Zhou Jianglin's rich experience, we are steadily advancing the rehabilitation medical chain layout by relying on the Kangnian holding platform. Since opening in 2012, the company has successfully created the “Xiangya Model”: ① Undertake the referral of patients from general hospitals such as Xiangya Hospital and the government to purchase rehabilitation services to guarantee the source of patients; ② Some properties use leasing forms, and the asset-light model has strong replication and promotion capabilities. Along with the gradual implementation of the “Notice on Adding Certain New Medical Rehabilitation Projects to the Scope of Basic Medical Insurance Payments” issued jointly by the Ministry of Human Resources and Social Affairs and other departments a few days ago, it may accelerate the process of expansion within the province. Third, the Chunhua-Health City project has achieved a good start in the field of old-age care. At the end of 2014, the company (accounting for 54%) cooperated with Xiangmao Investment and Uda Group to develop the Chunhua-Health City project. In the future, it may connect with existing rehabilitation resources to create a high-end health and old-age care demonstration zone. Fourth, equity investments provide abundant cash flow. The establishment of Huayin Consumer Finance Corporation was initiated during the reporting period to further increase the sources of investment income. The rich cash flow brought about by this provided a strong financial guarantee for the transformation. First coverage, giving a “buy-A” rating. The company's main business, hydropower, is stable, and the return on equity investment is high, providing sufficient cash flow. The transformation of rehabilitation+old-age care, and the overall health layout are beginning to show results. We expect the company's EPS for 16-18 to be 0.29 yuan, 0.35 yuan, and 0.39 yuan respectively; the current stock price corresponding to PE is 53 times, 44 times, and 39 times, respectively, and the target price for 6 months is 19.66 yuan. Risk warning: Project progress falls short of expectations