Incident: Ms. Chen Yamei, the actual controller and controlling shareholder of the company, plans to take the opportunity to increase her holdings of the company's shares in the secondary market within the next 6 months. The amount of capital required for this increase is not less than 20 million yuan. The source of capital required for this increase is Mr. Qiao Xin (a concerted actor)'s own capital or self-financing, and she has promised not to reduce her holdings in the company's shares during the increase period and for 6 months after the increase in holdings is completed. The core view is that the actual controller's holdings increase plus equity incentive registration has been completed, and management is firmly optimistic about the company's development: as of July 31, Ms. Chen Yamei directly held 37.98% of the company's shares and co-owned 50.92% of the company's shares with her co-actor, Mr. Qiao Xin. The plan is to increase her holdings by no less than 20 million yuan within 6 months. After the increase in holdings is completed, Chen Yamei is still the actual controller of the company, and the majority shareholders of the company have not reduced their holdings for 6 months after the completion of this increase; It shows the actual controller's recognition and confidence in the company's future development prospects. We believe that the company's actual controllers and co-actors have a high shareholding ratio, providing equity space for the company's continued capital operations in the future. Since the company's strategic transformation, measures such as employee shareholding, executive participation in supporting financing, directors' and supervisors' promises not to reduce their holdings, and restrictive equity incentives (grant price is 5.45 yuan/share) have been implemented one after another to deeply bind the management team and core technical personnel to enhance investor confidence. On July 18, the company completed the first grant registration for restricted equity incentives in 2017, and granted a total of 3,6311.07 million shares to 44 executives and core executives in the digital marketing sector. At the same time, it was awarded to executives and core technical personnel to promise the digital marketing sector and the unbanned performance of the three advertising agencies Shunwei, Qisi, and Li Xuan in 2017 and 2018. All three digital marketing companies exceeded their gambling performance after merging into listed companies, and it was agreed that the profit of the digital marketing sector and various marketing subsidiaries in 2018 would not be less than 10% compared to 2017, avoiding the risk of declining performance after the target gamble expired. On the one hand, this equity incentive binds the core technical talents of the company's digital marketing sector, and also ensures the endogenous growth of the digital marketing sector and the sustainable development of the three mergers and acquisitions; it is optimistic about the steady development of the company's future digital marketing sector and the smooth progress of the expansion of the layout along digital marketing to the SaaS field. Increased capital to Beijing Weilianda and promoted the layout of the SaaS ecosystem: Using digital marketing as an entry point, the company acquired three digital marketing companies, and then extended to the SaaS service sector: in 2016, it won 10% of shares in the consumer SaaS service leader, and the top six people in the SCRM segment and 15% equity and preferential acquisition rights. The two target investments built the company's business layout from general and vertical fields. In the future, it is expected that the SaaS ecosystem will continue to be deployed around the SaaS ecosystem to open up user information and data between applications in different business scenarios (marketing management applications of Winlink, SCRM applications of Six Degrees, and digital marketing applications) to achieve “marketing integration” for enterprises. As the target business continues to develop, the company is promoting the upstream and downstream expansion of the industrial chain. It plans to use its own capital to increase its holdings of Siduren and Beijing Microlianda, the main value-added distributor in China, to take down Liudian and downstream industry chain companies; in the future, Weilianda is expected to achieve further collaboration with listed companies, especially Siudouren, in terms of business and products, which will help the company deepen its layout in the SaaS field, achieve industrial chain collaboration, and build a SaaS ecosystem. Judging from Liudouren's business conditions in 2016, its order revenue reached 113.7 million yuan (YOY 127.41%), 241,300 new payment terminals (YOY 88.52%), and a retention rate of 80.61% for paying customers, far exceeding the requirements for dealing with gambling requirements of 80%, 40%, and 80%, showing that the target's development prospects are improving. Profit forecast and valuation: We expect the company to achieve net profit of 1.03/1.30/148 million yuan in 2017-2019, corresponding to EPS: 0.18/0.23/0.26 yuan/share; corresponding to the current stock price valuation: 44/35/31 x PE, respectively. We believe that the current correction in corporate valuation is obvious, and equity incentives are conducive to strengthening the steady growth and operation of the target company and ensuring steady progress in the company's expansion of the SaaS service field through digital marketing. This increase in shareholders' holdings shows confidence. In the future, they are optimistic that the company will continue to make efforts around enterprise-level SaaS services, further open up the interface and data between its subsidized companies, and strengthen the company's ability to invest in SaaS business to form a SaaS service ecosystem, giving it a highly recommended rating. Risk warning: The company's enterprise-grade SaaS is not progressing smoothly, integration risks, and industry growth is slowing down.