Key investment events: The company released its third quarter report and achieved operating income of 960 million yuan, an increase of 51.3% over the previous year, net profit of 110 million yuan, an increase of 77.8% over the previous year, net profit of 100 million yuan after deducting non-return to the mother's net profit of 100 million yuan, an increase of 78.6% over the previous year. Q3 achieved revenue of 390 million yuan in a single quarter, an increase of 66.7% over the previous year, net profit of 50.75 million yuan, an increase of 93.6% over the previous year, net profit of 50.17 million yuan after deducting net profit of 50.17 million yuan. The performance growth rate for the third quarter report is above the middle of the performance guidelines (50-90%). The company expects the 2017 performance to be 150-180 million, with a year-on-year growth rate of 90-130%. The overall performance was in line with expectations. Company Q2 began with Sanqi and Yingka. In the first half of the year, the company headquarters achieved revenue of 46,000 yuan, an increase of 16%, and achieved net profit of 41 million yuan, an increase of 19%. Q3 With the further improvement of the front-loading & pre-assembly structure, the headquarters vehicle engine business continued to improve. We expect the revenue and performance growth rate of the vehicle engine business to be around 20-25% in the first three quarters. Q4 With the mass production of models from downstream customers, the company's virtual instrument business will further enhance the performance of the vehicle engine business sector (5006,000 yuan/set of virtual instruments, about 1500-2500 for traditional vehicles) 。 Q3 The gross profit margin for the single quarter was 30.7%, up 0.3 pp year on year, down 3.8 pp month on month, net profit margin 13%, up 1.8 pp year on year and month on month. It is estimated that the company's pre-installation+pre-emptive revenue will account for 60-70% throughout the year. Recommended logic: The company's vehicle engine business continues to shift to front-loading (independent brands gradually expand to joint ventures and overseas) to control future in-vehicle human-computer interaction entrances; the company completed the handover of Sanqi (TBOX communication hardware) and Yingka (Internet of Vehicles software) at the end of March '17 to become a company with complete Internet of Vehicles solutions; it has formulated an overall development strategy extending to the field of intelligent driving and smart transportation, including: It plans to acquire 95% of Hangsheng Industrial's shares (the target of the commercial vehicle network) with 142.5 million yuan (expected to be consolidated in November '17, with a commitment to withholding sales in November '17) Is there any net profit after (Less than 16 million yuan), the business is expanded to integrated solutions for on-board electronic equipment for commercial vehicles; it is planned to obtain 5% equity in its own technology (the target of ADAS) through a 5 million yuan capital increase to strengthen the company's ability to provide comprehensive solutions for L3 autonomous driving; and invest 50 million yuan to build an LCD instrument production line, lay out upstream LCD meters, and control the core hardware of the intelligent cockpit. We expect that after going through a run-in period, the various sectors mentioned above will gradually exert synergistic effects, which in turn will lead the rapid development of vehicle networking and assisted driving in the automotive industry. Profit forecasts and investment advice. The company expects the 2017 performance to be 150-180 million yuan, with a year-on-year growth rate of 90-130%. Of these, net profit for the Q4 quarter was 37.51 million yuan to 68.13 million yuan. The impact of the acquisition of Hangsheng Industrial is not considered yet. The 2017-2019 EPS is expected to be 0.38 yuan, 0.56 yuan, and 0.7 yuan respectively, maintaining the “buy” rating. Risk warning: Synergistic effects of the acquisition target or risk of falling short of expectations; risk of automobile sales, development of the Internet of Vehicles, or failure to meet expectations.