Core point of view: 1. Incident The company released its report for the third quarter of 2017. 2. Our analysis and judgment 1) The Q3 quarterly performance was impressive, with net profit up 104.99% month-on-month. In the first three quarters of 2017, the company achieved total operating income of 4.197 billion yuan, an increase of 19.4% over the previous year; net profit attributable to shareholders of listed companies was 2,825 billion yuan, an increase of 22.27% over the previous year. The performance of Q3 in a single quarter was impressive. The company achieved operating income of 1,845 billion yuan, an increase of 156.94% over the previous month; and realized net profit attributable to shareholders of listed companies of 1,213 billion yuan, an increase of 104.99% over the previous month. The company's EPS for the first three quarters of 2017 was 0.62 yuan, a year-on-year increase of 4.45%, and an ROE of 19.92%, a year-on-year decrease of 12.84 percentage points. The overall performance was in line with expectations. 2) The trust business adheres to active management, and the investment income performance of the inherent business was good. In the first three quarters of 2017, the company achieved a total trust business revenue of 3.663 billion yuan, an increase of 27.09% over the previous year. This portion of revenue accounted for 87.3% of the company's total revenue, which is the company's main source of revenue. The company has long insisted on active management. Active management is the core competitiveness of the company, and the proportion of active management categories in the company's fiduciary assets is increasing year by year. Benefiting from a high scale of active management, the company's trust return rate is far higher than the industry average. Capital investment includes basic industries, real estate, industrial and commercial enterprises, and other fields. While deeply cultivating traditional businesses, the company strives to expand new business segments. The most obvious expansion results are in new energy and logistics real estate, and the proportion of business contributions in these fields is expected to gradually increase. In the first three quarters of 2017, the company achieved inherent business revenue of 533 million yuan, a year-on-year decrease of 15.66%. By business category, investment income grew high, while income from changes in fair value and interest income declined. The first three quarters achieved investment income of 413 million yuan, a year-on-year increase of 98.24%; achieved net income from changes in fair value of 47 million yuan, a year-on-year decrease of 79.71%. Looking at a single quarter, benefiting from the recovery of the stock market, profit and loss from changes in fair value in the third quarter turned a loss into a profit, achieving revenue of 503 million yuan; and realized net interest income of 74 million yuan, a year-on-year decrease of 61.86%. Intrinsic sources of business income are diversified, and capital is invested in financial products including loans, securities markets, fixed growth, and equity investment in unlisted financial companies. The company's preferred stock issuance plan is in progress. If successfully implemented, it will further expand the existing business development space. 3) Explore the layout of diversified financial platforms, and the prototype of the financial landscape reveals that companies are actively exploring diversified financial platforms and building an integrated financial service system based on the main trust business. Bank equity investment progressed steadily during the reporting period. The board of directors reviewed and approved the subscription for no more than 3.4% of the shares of China CITIC Bank (International) Limited. Participated in Yingkou Bank's capital increase and held 4.27% of its shares. The insurance industry layout began, and Bohai Life Insurance took a stake in Bohai Life, holding 3.85% of the shares. At the same time, it participated in the establishment of CITIC as a funder to promote the continuous and steady development of the industry. 3. Investment recommendations The company's 2017/2018 EPS is expected to be 0.86 yuan/0.95 yuan. The current stock prices corresponding to 2017/2018 PE are 15.57X/14.09X, respectively. Combining fundamentals and stock price elasticity, a “recommended” rating was given. 4. Risks indicate a decline in trust returns; the risk of deterioration in trust asset quality.