Event: On July 13, 2017, the company released the 2017 semi-annual performance forecast: The estimated net profit is about 35.3059 million yuan to 42.6613 million yuan, an increase of 20% to 45% over the previous year. The impact of non-recurring profit and loss on net profit is estimated to be about 7.5077 million yuan. Comment: The company is currently operating well, and the “hemodialysis+monitoring” two-wheel drive has increased its mid-term performance by 20%-45%: the company's main business is mainly divided into two major parts: hemodialysis and monitoring. Among them, the hemodialysis business has benefited from the industry's high growth of more than 30% and the company's entire industry chain layout. It is expected that the company's hemodialysis business will continue to grow at a high level; monitoring business companies are expected to maintain steady growth by rationally positioning domestic and foreign markets. Driven by the dual main business of “hemodialysis and guardianship”, the company's performance is expected to increase by 20%-45% in the middle of 2017. Continuing to focus on hemodialysis, the entire industry chain layout is becoming more and more perfect: the company is determined to focus on “product manufacturing+channel construction+medical service” and focus on the field of hemodialysis. At present, on the upstream production side, the company has deployed hemodialysis machines, dialysis machines, hemodialysis powder, hemodialysis lines, disinfection products, etc. Among them, hemodialysis powder has basically completed the layout of production bases nationwide; midstream distribution companies have continued to promote marketing channel layout and have completed the integration of channel providers in Shanghai, Shenzhen, Guizhou, etc.; and downstream service-side companies have completed acquisitions such as Qingyuan Kanghua Hospital and Xiantao Tongtai Hospital. The layout of the entire hemodialysis industry chain is getting better and better, and the hemodialysis business is operating well. The monitoring business is rationally positioned in domestic and foreign markets, and steady growth in sales can be expected in the future: in the domestic market, the company will reposition monitoring products according to low, medium and high levels, and sell corresponding dealers according to segmentation to strengthen product sales; in foreign markets, the company will rationally develop markets with high demand, such as Africa, and expand sales space for products. Based on reasonable positioning and layout at home and abroad, the monitoring business is expected to maintain steady growth in the future. Profit forecast and valuation: According to our estimates, the company's EPS in 17-19 was 0.70, 0.95, and 1.29 yuan, respectively, corresponding to 40, 29, and 21 times PE. Considering performance growth and the scarcity of the entire blood transmission industry chain layout, the company was given 50 times PE, with a target price of 35 yuan, maintaining a “highly recommended” rating. Risk warning: The implementation of the company's extension fell short of expectations, and the risk of changes in national policies; market competition intensified.