Matters: The company released its 2017 semi-annual report on the evening of August 21. The company achieved revenue of 562 million yuan during the reporting period, an increase of 42.13% over the previous year; realized net profit of 57 million yuan, an increase of 65.82% over the previous year; the company expects the net profit range of 0.91 to 115 million yuan from January to September 2017, an increase of 50 to 90% over the previous year. Comment: Performance is in line with expectations. High-end products, increased front-loading share, and acquisitions are driving growth together. The company's revenue for the first half of the year increased by 42.13% year on year, and net profit of the company increased by 65.82% year on year, which is in the upper part of the forecast range (40% to 75%), in line with expectations. Among them: (1) High-end products continued to advance, front-loading business achieved rapid growth, revenue of intelligent CID series products increased by 64.77% year-on-year, and gross margin increased by 1.09pcts. (2) Sanqi Communications and Inka Technology, the targets of the previous acquisition, began merging in the second quarter, further boosting the company's performance. The company added 53 million yuan in vehicle electronics revenue and 60 million yuan in vehicle networking technology services. It is planned to acquire Shanghai Hangsheng to expand the automotive electronics business for commercial vehicles. On August 11, the company's board of directors reviewed and passed a bill to acquire 95% of Shanghai Hangsheng Industrial's shares at a price of 142.5 million yuan. The target promised net profit for 2017 was not less than 16 million yuan. Shanghai Hangsheng's core business is commercial vehicle automotive electronics. According to the company's semi-annual report, its market share is 20%-30%. Major customers include Yutong (about 40% of revenue), Sinotruk (about 15-20% of revenue), and Jianghuai. The acquisition will help the company expand its product and channel capabilities in the commercial vehicle sector, and is expected to achieve effective collaboration with existing business systems. The overall strategy is clear, and product development continues to advance. The company's overall strategy is clear. Gradually achieving high-end products and achieving rapid expansion of front-loading business is the primary strategy. Accelerate the penetration of new products such as front-loading ADAS, LCD dashboards, and HUD; at the same time, stabilize the rear-end business market through cooperation and new market (commercial vehicles/UBI) expansion. The planning and development of intelligent cockpit products and connected vehicle products continues to advance, providing further strong support for the company's medium- to long-term development. Risk factors: New product promotion falls short of expectations, and market demand for front and rear accessories is slowing down. Maintain the “Overweight” rating. The company's performance is in line with expectations, the overall strategy is clear, and the product development plan continues to advance. We predict that the company's EPS after the latest share capital adjustment in 2017-2019 will be 0.41/0.52/0.68 yuan; we continue to be optimistic about the company's internal and external collaborative layout and comprehensive competitiveness in emerging industries such as the smart cockpit and the Internet of Vehicles, and maintain the company's “increase in holdings” rating. There is no target price yet.