The 2015 results were in line with expectations. In 2015, Huarong's revenue increased 48% year on year to 75.4 billion yuan; net profit attributable to shareholders increased 36% year on year to 14.5 billion yuan, mainly benefiting from steady growth in various businesses. Trends The internal rate of return for disposal of non-performing debt assets has improved markedly. Huarong has accelerated the pace of acquisition and disposal and improved the efficiency of capital utilization. The internal rate of return rose significantly by 4.2 percentage points to 20.2%, exceeding expectations. The business of acquiring and restructuring non-performing loan assets is solid, asset quality is stable, and provision coverage has improved. The impairment ratio declined slightly to 1.5%, and the loan ratio rose further to 8.7%, forming a more effective safety cushion and reducing concerns about credit risk in a macro-downturn environment. Annualized earnings fell to 12.5%, but financing costs also fell to 5.55%. We believe that as the capital raised from IPOs is better used in 2016, the average return on net assets of non-performing asset operations will remain at 16% to 19%; the capital raised from IPOs will be utilized in 2016. The contribution of financial services and asset management/investment has increased; the credit exposure of banking/leasing/trust businesses is well managed. The profit forecast was slightly raised to the 2016/17 EPS forecast of 2.9% and 0.3% to 0.48/0.58 yuan. Valuation and recommendations We believe that Huarong will benefit from improvements in the real estate market. Maintain recommendations. The target price of HK$3.69 remains unchanged, which is equivalent to 1.05x the 2016 net market ratio. Risk real estate market adjustments.