Key investment events: The company issued a restricted stock incentive plan and plans to grant 2 million restricted shares to incentive targets, accounting for 0.99% of the company's total share capital. The grant price is 12.35 yuan/share. The source of shares is targeted distribution to incentive targets. Incentives granted for the first time include the company's directors, senior management, and a total of 30 core members of the company. After the expiration of 12 months from the date of grant, those who meet the conditions for lifting the sales restrictions can lift the sales restrictions in three installments within the next 36 months at a ratio of 30%, 30%, and 40%. They promise that the revenue growth rate in 2017/2018/2019 will not be less than 10%, 25%, and 35%, respectively, based on 2016 operating income. Equity incentives have finally been implemented, stimulating the company's long-term development potential: some executives owned shares in the company before listing; after listing, the company's management was slightly adjusted, and new executives were put in place. In order to bind the interests of core management, the company launched its first equity incentive plan after listing, and included many of the company's core cadres in the scope of incentives, showing the importance the company attaches to management's interests and management's confidence in the company's long-term development. The main business grew steadily and enjoyed industry dividends. In 2017, the number of births in China is expected to be close to 20 million, a new high since 2000 years. The implementation of the two-child policy and consumption upgrades will undoubtedly drive a sharp increase in demand for maternal and child consumer goods. As one of the leading domestic mother and child brands, the company will directly benefit from the high growth of the industry. The company's main business returned to a steady growth trajectory after cleaning up the initial channel inventory, and the results of channel adjustments were gradually showing: the number of encrypted offline outlets reached more than 1,300, while also starting business on platforms such as Tmall, JD, and Vipshop. While expanding the number of stores horizontally, the company has also strengthened the detailed management of single stores, upgraded the original POS information system, introduced a new system to vertically control the sales and inventory situation in stores, and grasped the best-selling and slow-selling products in real time, greatly improving decision-making efficiency, which is beneficial to the increase in the growth rate of the same store. The layout of the mother and child ecosystem is progressing steadily. The company participated in subscribing for shares in the Asia Pacific International Maternal, Infant and Child Industry Fund last year, making full use of the industrial resources of overseas teams to introduce high-quality overseas brands and services into the domestic market. Participating in the subscription of 20% of Mialle's shares this year, officially entering the baby food industry, giving full play to the advantages of Mialle's online direct management, and forming collaboration with the company's offline mother and child stores is an important step in building a mother and child ecosystem. While the company's main business is developing steadily, there is huge room for imagination in the future in terms of culture and entertainment, consulting and education, and domestic service, etc., and the extended development is still worth looking forward to. Profit forecasts and investment advice. The company's 2017-2019 EPS is estimated to be 0.42 yuan, 0.5 yuan, and 0.61 yuan respectively. Considering that the company will directly benefit from the high growth of the maternal and child industry, results are gradually showing in marketing network layout and management adjustments, maintaining the “increased holding” rating. Risk warning: Risk of sales growth falling short of expectations; risk of extension expansion falling short of expectations.