Event: In the first half of 2017, Huafeng Microfiber achieved operating income of 1.0 billion yuan, a year-on-year increase of 59.75%, net profit of 86.274 million yuan, a year-on-year increase of 96.19%. Among them, Jiangsu Huafeng Microfiber Materials Co., Ltd. achieved sales revenue of 482 million yuan and net profit of 24.29 million yuan in the first half of the year; the subsidiary Weifutong achieved operating income of 171 million yuan, operating profit of 97 million yuan, and net profit of 88 million yuan in the first half of the year. Core point of view: 1. Traditional businesses have achieved unconventional development, and the performance growth rate is expected to be maintained in the second half of the year. 2. The rapid growth of the mobile payment business is in line with expectations, and the annual turnover of trillion dollars is one step closer. 3. Weifutong's international business continues to make breakthroughs, and the compound growth rate of overseas turnover exceeds 50%. Profit and valuation: The parent company is the leader in the microfiber industry, and its performance in the first half of the year has developed by leaps and bounds. It is estimated that the net profit generated in '17 is 140 million, 35 times PE, with a market capitalization range of 4.9 billion; Weifutong's net profit for 2017 is expected to be 304 million yuan. Considering Weifutong's leading position in the payment industry, it has given a 45 times valuation, with a market value of 13.6 billion; we gave Huafeng Microfiber an overall valuation of 18.5 billion yuan, corresponding to the current valuation of 15.9 billion yuan, maintaining a “recommended” rating. Risk warning: The penetration rate of mobile payments has fallen short of expectations.