Key investment events: The company released its 2017 semi-annual report. In the first half of 2017, it achieved operating income of 1,804 billion yuan, a year-on-year decrease of 1.4%, and achieved net profit of 135 million yuan, an increase of 128.9% over the previous year, reaching the upper limit of the performance forecast, and achieved deducted non-net profit of 130 million yuan, an increase of 163.5% over the previous year. The company also announced its performance forecast for January-September 2017. The net profit change range from January to September 2017 was 161-212 million yuan, with a year-on-year change of 60%-110%. The revenue of the TV advertising business declined, and the Internet advertising business maintained high growth. Zhi Hai Yangtao also contributed to a sharp increase in the revenue of the brand management business. 1) TV commercials: 2017H1, TV commercials achieved revenue of 493 million yuan, a year-on-year decrease of 30.6%. Although advertisers have reduced the amount of television commercials, television commercials are still an important form of marketing communication. 2) Internet advertising: 2017H1, Internet advertising achieved revenue of 694 million yuan, an increase of 48.6% over the previous year. Internet video advertising and search engine marketing became growth points, with customers involved in the automotive, fast selling products, pharmaceuticals, finance and other industries. 3) Brand management: 2017H1, the company completed the acquisition of 60% of Zhihai Yangtao's shares, and the brand management business achieved revenue of 77.63 million yuan, a significant increase of 329.1% over the previous year. The content and content marketing landscape has been expanded, and high gross margins enhance the company's overall profitability. In the first half of 2017, the company completed the acquisition of 100% of the shares of Zhangwei Technology, 100% of Guanda Film and Television's shares, and the remaining 20% of Keyi Communications, further expanding its content and content marketing business. 2017H1 achieved revenue of 481 million yuan from the content and content marketing business. Due to the high gross margin of the target of the acquisition, the gross margin of the 2017H1 business reached 33.2%, an increase of 18 percentage points over the previous year, driving the company's overall gross margin to 17.4%, an increase of 5.6 percentage points over the previous year. In terms of content: The company tested the waters for the first time and co-produced the homemade variety show “True Star Tales” with Zhejiang TV; “Because I Met You” produced by Guanda Film and Television had an average ratings of 1.93%, winning the runner-up in the first half of 2017. In terms of content marketing: The company continues to provide customers with content marketing services for popular variety shows such as “Challenger League”, “24 Hours”, “Ace vs. Ace”, and “Voice of Dreams”. The general manager has increased its holdings, and the company's confidence can be learned. On July 25 and 26, the company's general manager increased his total holdings of the company's shares by 242,000 shares in the secondary market, increasing his holdings by more than 5 million yuan, showing firm confidence in the company's future development. Profit forecasting and investment advice. The average valuation level of the industry in 2017/2018 was 25 times/20 times. Considering the synergy brought about by the company's acquisition of 4 subsidiaries in the first half of 2017 and the rapid growth of the company's content business, the company was valued 30 times in 2017, and continued to be optimistic about the company. The target price was 27.6 yuan, maintaining the “buy” rating. Risk warning: performance of the subject of the acquisition or failure to meet promises; merger and acquisition integration risks; media industry policy risks.