Key investment matters: On the evening of November 29, the company announced that the controlling shareholders and some directors intend to increase their holdings by no less than 3 million shares. Ping An's view: The increase in shareholders' holdings highlights confidence in future development, and is driven by multiple factors towards rapid performance growth: On November 29, the company announced that the controlling shareholders and some directors plan to increase their holdings of the company's shares by no less than 3 million shares (about 0.2% of the total share capital, no more than 15 yuan/share) for 20 trading days starting November 30, 2017, demonstrating the controlling shareholders' confidence in the future development of the company. The company's products mainly cover four major series of electroacoustic products, health appliances, smart wearables, and metal parts for mobile smart terminals. In the first three quarters of 2017, driven by the continuous growth of various businesses, the company achieved operating income of 1,794 million yuan, an increase of 29.44% over the previous year, and realized net profit of 278 million yuan, an increase of 15.65% over the previous year. Considering the strengthening growth trend of the company's electroacoustic business, the horizontal expansion of health products, and the remarkable synergy between Fuchengda and Opunda, the company's 2017-2019 performance is expected to maintain a compound growth rate of more than 35%. In the face of the smart speaker wave, the competitive advantage is obvious: According to third-party data, Amazon Echo had impressive sales between Black Friday and Cyber Monday. As new smart speaker products from international giants are gradually launched, and domestic Internet technology giants such as JD, Ali, and Xiaomi vigorously expand the domestic market, global smart speaker sales can reach 20 million to 30 million units in 2017. Following the trend of industry development, the company cooperated with JD (exclusive), Ali (exclusive, “Double Eleven” with cumulative sales volume exceeding 1 million units), and BestBuy and signed a 300 million yuan smart speaker order. Shipments will begin at the end of the third and fourth quarter of this year. At the same time, the company uses the ODM and OBM two-wheel drive development models (mainly ODM, accounting for more than 85%). Compared with the OEM model, it has higher profitability. At the same time, it will not be affected by the slow development of OBM ceilings and insufficient competitiveness, so the company's competitive advantage is obvious. Epitaxial promotes the improvement of the precision manufacturing layout and benefits from customer A's new product launch: The company's merger and acquisition of Opunda in 2014 included metal exterior parts into the business landscape, and in 2016, it further acquired Apple parts supplier Fuchengda. On the one hand, Opunda specializes in exterior parts such as chassis, middle frames, and buttons, and Fuchengda specializes in internal structural parts such as brackets, holders, and lampcovers. The participants collaborate to achieve both internal and external repair of smart terminal metal parts, share customer resources, and further increase the variety and share of products among customers. On the other hand, Fuchengda is a stable supplier of precision structural parts for Apple. This year, it undertook more than 100 Apple product numbers, which is double the number of items from last year. Among them, the unit price of the additional models such as dual camera mounts has reached 1.5 US dollars, which will significantly increase the stand-alone value of the company's products. In the future, with the popularity of Iphone X, customer A orders will gradually shift to company performance, bringing strong profit growth points. Investment advice: The company started with multimedia speakers and entered the smart speaker market in line with the wave of intelligent development. It has successively acquired Opunda and Fuchengda to improve the precision manufacturing layout and create a new profit growth pole. We maintain our previous profit forecast. It is estimated that the company's operating income for 2017-2019 will be 28.87/44.45/5.684 billion yuan, net profit of 5.35/8.72/1,053 billion yuan, corresponding EPS of 0.36/0.59/0.71 yuan, and corresponding PE of 31/19/16 times, maintaining the company's “recommended” rating. Risk warning: The risk that the growth rate of the metal exterior parts business will slow down, and the risk that the integration will not meet expectations.