Incidentally, Kehua Biotech signed an agreement with Zhuhai Ruiyou, Zhuge Zhen, and Mi Xuancheng to acquire 55% of Guangdong Xinyou's shares held by Zhuhai Ruiyou with its own capital of RMB 153 million. Existing shareholders promise that the target company's main business revenue in 2017 will not be less than 60 million yuan, profit before tax will not be less than 9.2 million yuan, and profit before tax from September 1, 2017 to December 31, 2017 will not be less than 6.5 million yuan. The target company achieved main business revenue of not less than 195 million yuan, 22 million yuan and 250 million yuan respectively in 2018, 2019, and 2020; the net profit realized was not less than 26.13 million yuan, 31.94 million yuan, and 38.16 million yuan, respectively. Existing shareholders promise that the target company's revenue contributions from sales of Kehua Biotech and its subsidiary products will not be less than 20 million yuan, 25 million yuan, and 30 million yuan, respectively, in the main business revenue achieved in 2018, 2019, and 2020. Commenting on the merger and acquisition of Hitachi Biochemical's four provinces, the main business of Guangzhou Ruiyu, which is controlled by the target's existing shareholders, is to act as an agent for Hitachi's fully automated biochemical instruments and biochemical inspection products such as supporting biochemical reagents and consumables. It has first-level agency rights for Hitachi Biochemical in the Guangdong, Guangxi, Hunan, and Hainan markets, and currently maintains nearly 1,000 Hitachi Biochemical terminals. In the first half of 2017, the existing shareholders of Target transferred the first-level agency rights of Hitachi Biochemical in the Guangdong, Guangxi, Hunan, and Hainan markets to Guangdong Xinyou, and promised to integrate all sales operations and related assets and personnel of “Hitachi” brand fully automated biochemical analyzers and reagents directly or indirectly within and outside of China under the name of the target company by December 31, 2017. In 2016, the Hitachi biochemical agency business achieved revenue of about 150 million yuan and net profit of about 22 million yuan. This time, the company acquired Guangdong Xinyou shares, and obtained Hitachi's general interest in many major population and medical provinces, which can further increase the company's revenue and profit scale and good synergy with the existing business, which is expected to drive the excellent quality level of clinical biochemical reagent products from self-produced chemical companies and have a strong influence in the industry; while Hitachi, as the world's leading automatic biochemical analyzer, has a huge number of installed machines in China, and has obvious market advantages. This merger and acquisition has a good “instrument+reagent” synergy. The target company and its management team have many years of experience in market development and after-sales service for products such as instruments and supporting reagents in the field of in vitro diagnosis, especially biochemical diagnosis. They are responsible for after-sales maintenance and training of Hitachi biochemical instruments in the four provinces of Xiang, Guangdong, and Guiqiong. They already have a considerable number of installed terminals and end customers. The customer stickiness is strong and the market influence is strong. This merger and acquisition is expected to further drive the company's self-production business growth in the future, especially to expand sales of the company's biochemical reagents and other products in the middle and high-end markets (currently, most clinical biochemists in large and medium-sized hospitals in China use imported brands). The internal growth+channel merger and acquisition product business format is continuously optimized. As a leading enterprise in the domestic IVD industry, the company has a complete business line of “reagents+instruments” and “self-production+agents”. The product range is rich and comprehensive, and the channel and service capabilities are solid and comprehensive, which is in line with the direction of IVD industry development. While adjusting the company structure and consolidating its original business position, the company is actively developing new product lines such as chemiluminescence, increasing channel investment and construction, and carrying out terminal collection services. In the future, it is expected that it will continue to enrich its revenue sources and open up a new situation of growth. The profit forecast takes into account the positive impact of epitaxial extension. We forecast the company's EPS for 2017-2019 to be 0.48, 0.58, 0.72 yuan, and an increase of 7%, 21%, and 23% year-on-year. Maintain an “Overweight” rating. It is expected that in the future, performance will gradually break out of its trough as factors such as export recovery, release of light-emitting products, and beneficial hierarchical diagnosis and treatment are implemented. Risk suggests that the company's chemiluminescence market promotion did not meet expectations; export recovery was slower than expected