1. Incident: The company plans to purchase 100% of its shares in Tianyi Space from the controlling shareholder China Telecom by means of cash payment. Tianyi Space and the four targets of the previous acquisitions belong to the mobile Internet industry. This acquisition promotes the collaborative development of the company's business and enhances the overall performance of the sector. The sustainable profitability of 2 Tianyi Space has underestimated acquisitions and increased the market value elasticity of listed companies: the market value of 250 million dollars is conservatively equivalent to about 8 times PE in 2016, and the asset value is not fully reflected. 3. With the advantages of major shareholders' resources, the Internet business continues to be integrated, and the pan-entertainment industry ecosystem is initially formed: it has channels, marketing, and communication portal resources for China Telecom shareholders. After integrating high-quality assets in the Telecom Group's business, it is expected to bring about a steady increase in business revenue. At the same time, the integrated business is based on an “Internet +” layout, covering aspects such as culture, entertainment, tourism, services, etc., and the pan-entertainment industry ecosystem has initially formed, making it optimistic about the company's future performance. 4 Profit forecast and investment advice: The short-term merger of high-quality assets will drive a significant increase in performance, and the performance growth over the next two years will be sustainable. We predicted that the company's 16/17/18EPS would be 0.37, 0.45, and 0.49, and the corresponding PE would be about 46/38/34 times, giving it a “highly recommended” rating. 5. Risk warning: the risk of intense market competition; new business development falls short of expectations; and progress in state-owned enterprise reform falls short of expectations.