Jinling Pharmaceutical can introduce Nanjing Gulou Hospital Group as a technical partner for the acquired hospitals, which is more attractive for the acquired hospitals facing development bottlenecks; the restructuring of the Suqian People's Hospital is driven by a specific era and political background, and the company's acquisition of Yizheng Hospital is highly replicable. Investment points 1. The profit contribution of medical services will surpass pharmaceutical production and marketing in the next 3 years and become the main driving force for increasing market value. Jinling Pharmaceutical's competitive advantages in developing medical services are its financial advantages as a platform for listed companies, the resource advantages of introducing the Nanjing Gulou Hospital Group as a business manager, and the background advantages of state-owned enterprises suitable for participating in the restructuring of public hospitals. 2. The innovation and restructuring of Suqian People's Hospital has achieved great results. The restructured Suqian People's Hospital implemented a director-general responsibility system under the leadership of the board of directors, Gulou Hospital dispatched chief and deputy directors, and Jinling Pharmaceutical sent party committee secretaries and financial directors to the hospital, forming a new model of hospital operation integrating the advantages of technology, capital, and government resources. From 03 to 2012, the number of hospital beds increased from 522 to 1,000, the bed usage rate increased from 72.3% to 141%, and the number of outpatient emergency services increased from 190,000 to 930,000. The revenue and net profit scale of hospitals grew from 0.81/05 million yuan in 2005 to 682/83 million yuan in 2013. The compound growth rates of revenue and net profit were 30% and 42%, respectively. 3. The acquisition of Yizheng Hospital is highly replicable. First, employee hospitals have already gone through a restructuring where natural persons hold shares, and the complexity of acquisitions is far less complex than that of public hospitals; second, the abolition of drug bonuses has had a negative impact on level-II hospitals. In the future, level-II hospitals will seek capital and technical support from outside, and it will become a major trend for level-II hospitals to seek capital and technical support from outside. 4. There is little risk of price reduction for chelonine injections, and it is expected to maintain steady growth in the future. As an exclusive base drug with a lower price, choronine is less at risk of future price reductions. Since the amount of daily medication used is lower than that of superior varieties, there is relatively little room for marketing expenses, and it is expected to maintain a steady growth rate of 10% over the next 3 years. 5. Investment advice: Predict that the company's EPS for 14/15 will be 0.36 and 0.43 yuan, and the current stock price corresponding to PE is 34X and 28X. It is optimistic about the cooperation model of Jinling Pharmaceutical's export capital as the management party and Nanjing Gulou Hospital's medical capital export power as the business manager, and considering that the company has merger and acquisition expectations, a recommendation rating is given. Risk warning 1. The speed of progress of the medical service business is lower than expected 2. Medical reform and fee control is putting pressure on the pharmaceutical business