Matters: 1) The company released its 2017 three-quarter report, achieving operating income of 670 million yuan, an increase of 1.23% over the previous year; realized net profit of 35.115 million yuan, -211.62%; and achieved an EPS of -0.06 yuan/share, -220% year-on-year. 2) The company expects to achieve net profit of 25 million yuan to 35 million yuan in 2017, with net profit of 334.357 million yuan for the same period last year. Project progress fell short of expectations, and losses in the third quarter narrowed month-on-month: the company's project construction progressed slowly, causing the company's revenue growth rate to deviate from the industry average. The company achieved revenue/net profit of 670 million yuan/-35 million yuan in the first three quarters of 2017, respectively, an increase of 1.23%/-211.62% over the previous year. On a quarterly basis, the company achieved revenue of 177/3.32/161 million yuan in Q1, Q2, and Q3 in 2017; increased by 62.06%/-7.29%/-17.29% respectively; the Q3 business scale continued to decline year-on-year and month-on-month; net profit for the same period was -757/1983/-14.02 million yuan, respectively, -854%/-182%/-218%, and losses narrowed month-on-month. Due to factors such as the increase in the company's financial expenses in 2017 compared to the same period last year and the increase in the calculation of impairment losses on the company's assets, the company anticipated losses of 25 million yuan to 35 million yuan in 2017. High margin business development was slow, financial expenses were high, and high asset impairment caused losses: the company's comprehensive gross profit ratio for the first three quarters of 2017 was 20.73%, down 4.16 pct from the same period last year. We believe that it was mainly limited by the company's own business mechanism, capital requirements, etc., which caused the slow development of high-margin business. The projects implemented during the reporting period were mainly low-margin municipal integrated construction projects; in addition, the company's indirect financing costs and loan scale rose during the reporting period, causing the company's financial expenses for the first three quarters to reach 62.14 million yuan, up 30.74% year on year; company Asset impairment losses during the reporting period were 18.16 million yuan, an increase of 857.71% over the previous year, mainly due to increased accrual of accounts receivable for important projects over time. The company plans to extend the validity period of the non-public resolution and expects the company to successfully obtain approval: the validity period of the company's non-public shareholders' meeting resolution will expire on November 3, 2017. In order to ensure the smooth implementation of work related to non-public issuance, the company announced that it intends to extend the validity period of the non-public shareholders' meeting resolution and the validity period of the authorization until November 3, 2018. In August 2017, the company issued the “Special Instructions on Post-Conference Issues Concerning Non-public Stock Issuance”. It is hoped that the company will successfully obtain approval. If the company's non-public offering succeeds, it will significantly improve the company's capital structure. The company's balance ratio is expected to drop to around 55%, and the loans entrusted by the Group are expected to be reduced by 4.7 billion yuan, which is expected to save 41.595 million yuan in annualized interest (based on the latest loan interest rate of 8.85% /year). Investment advice: Lower performance estimates and maintain a buy-A rating. We have lowered the company's performance estimates, and we expect net profit in 2017-2019 to be -176%, 456%, and 61% year-on-year. The company's core focus is on state-owned enterprise reform. The company is the only holding and listing platform under the Cloud Investment Group. At the end of June 2017, the company's total assets accounted for 1.65% of the group. It is a typical large group of small companies. It is expected that there is plenty of room for the company's state-owned enterprise reform. Maintain the company's buy-A investment rating and maintain a target price of 29.05 yuan for 6 months, corresponding to 59 times PE in 2018. Risk warning: State-owned enterprise reform falls short of expectations, PPP progress falls short of expectations, project repayment risks, litigation and arbitration risks, etc.