Performance Overview: In the third quarter of 2013, the company achieved operating income of 398 million yuan, an increase of 7.37% over the previous year; operating profit of 156 million yuan, an increase of 21.98% over the previous year; net profit attributable to owners of the parent company of 107 million yuan, an increase of 21.94% over the previous year; and basic earnings per share of 0.1938 yuan. Fundamental description. The company is a government financing platform specially set up by the Tieling Municipal Government to develop Tieling New Town. It is mainly responsible for first-level land development. The predecessor of the company was Zhonghui Pharmaceutical. After the restructuring, Tieling Financial Asset Management Co., Ltd. held 189 million shares (34.37% of shares). According to the promises of several shareholders including Tieling Finance, the company's net profit in 2013 should not be less than 739 million yuan. Land development business was relatively lackluster in the third quarter. Revenue for the third quarter fell 84.61% year on year to 41.3092 million yuan, and the company's profit was 6.0621 million yuan, mainly due to the large impact of seasonal fluctuations in the company's land sales volume, while the majority of sales were concentrated in the fourth quarter. If the calculation is based on the previous performance promises of shareholders such as Tieling Finance and Economics, it means that the company still needs to achieve a net profit of 632 million yuan in the fourth quarter. Future growth remains to be seen. Although Tieling New Town was listed as a pilot project for a new type of urbanization by Liaoning Province, judging from the current overall performance, there are related problems such as insufficient actual demand for local real estate (too large spatial distance between the new city and the old city) and commercial service support construction lagging behind housing construction; furthermore, although some industrial projects have already settled in the Xincheng Industrial Park, the effect of boosting the Xincheng economy is not significant due to poor transportation facilities. Company announcements. From September 11 to 18, Rodean, a shareholder of the company, reduced his holdings of the company's shares by 28.05 million shares, accounting for 5.10% of the company's total share capital. According to data, Luo Dean is one of the major shareholders in the 2011 corporate restructuring. After the restructuring was completed, Beijing Jingrun Blue Chip and Luo Dean held 17.19% and 10.66% of the company's shares, respectively. The ban on these shares was officially lifted in January of this year. After this reduction in holdings, Rodeon and his co-actors held 78.5161,000 shares of the company, accounting for 14.28% of the company's total share capital. Profit forecasts and investment ratings. We expect the company's earnings per share for 2013-2014 to be 1.35 yuan and 1.02 yuan respectively. Based on the closing price on October 21, 2013, the corresponding dynamic price-earnings ratio is 7 times and 9 times, respectively. Considering that there is a big gap between the company's annual performance commitments and that the future popularity of the Tieling land market remains to be seen, we downgraded the company's investment rating to “neutral.” Risk warning. The pressure on local government expenditure is high, and there is uncertainty about project settlement and repayment; there is a risk that the lifting of the ban on placement shares will cause fluctuations in stock prices; and be wary of the risk that real estate regulation and sales will fall short of expectations.