Investment Highlights The company disclosed its 2017 annual report: During the reporting period, the company achieved operating income of 2,572 million yuan, up 4.7% year on year; net profit from mother was 312 million yuan, up 13.19% year on year; net profit after deducting non-return to mother was 302 million yuan, up 17.25% year on year; net cash flow from operating activities was 210 million yuan, up 1518.08% year on year. 2017Q4 achieved revenue of 775 million yuan in a single quarter, a slight decrease of 4.2% year on year, and net profit to mother of 104 million yuan, a slight decrease of 1.9% year on year. At the same time, the company will distribute a cash dividend of 0.30 yuan (tax included) for every 10 shares to all shareholders. The smart building and smart medical businesses are growing rapidly, and their share of revenue continues to rise. The company's three main businesses in 2017, 1) smart construction and energy efficiency: achieved revenue of 1,414 billion yuan, a year-on-year increase of 35.65%, and a gross profit margin of 27.95%, which is basically the same as the same period last year; 2) Smart healthcare: achieved revenue of 915 million yuan, up 18.24% year on year, gross profit margin 36.03%, up 0.83 percentage points from last year; 3) Smart Transportation: achieved revenue of 138 million yuan, a year-on-year decrease of 72.34%, gross profit margin of 26.38%, up 7.24 percentage points from last year. During the reporting period, the company's smart construction and smart medical business grew rapidly. Among them, the company's new smart medical business revenue increased 4.07 percentage points to 35.57%, gradually becoming the core driving force driving the company's business development. The sharp decline in the smart transportation business is mainly due to delays in the commencement of the construction of the company's advantageous regional projects in 2017. With the signing of the company's rail transit projects in Shanghai, Chengdu, and Shijiazhuang, we expect the company's smart transportation business to recover significantly in 2018. The smart medical business is developing smoothly, orders are sufficient, and the business can be expected to continue to grow at a high rate. In 2017, the company was deeply involved in the field of smart medical care, and related business development was smooth: 1) Jiuxin Medical achieved annual revenue of 693 million yuan, achieved net profit of 84.19 million yuan, and had a stable market share. It successfully developed a 3D surgical diagnosis and treatment support system and a real-time AR surgery collaborative guidance system to open up the digital application of the full diagnosis and treatment cycle from the radiology department to the operating room; 2) Continued to sign large-scale smart medical orders, and the business is expected to continue to grow rapidly: In 2017, the company signed an informatization project for the second affiliated hospital of Zunyi Medical University, with a contract amount of 55.96 million yuan. The overall construction solution for the entire life cycle of the hospital continues to be improved; the contract amount for smart hospital PPP projects such as the Hongzehu Medical Care Complex reached 2.27 billion yuan; at the same time, the company's Huainan Smart Healthcare PPP project was successfully passed by the 2017 government performance evaluation. Currently, the company has strong competitive strength and sufficient order volume in the smart medical field. In the future, as related businesses continue to expand, we expect the company's smart medical business to continue to grow rapidly. Expense control is good, and R&D investment is growing steadily. In 2017, the company's sales expenses and management expenses were 220 million yuan and 211 million yuan respectively, up 17.79% and 5.65% year-on-year respectively. The growth was steady, reflecting the company's good ability to control expenses. In 2017, the company continued to enhance the optimization and upgrading of core technologies such as IBMS systems and DasRDB real-time databases in the company's projects. The total investment in related R&D was 105 million yuan, an increase of 14.33% over the previous year, accounting for 4.08% of revenue, a slight increase of 0.34 percentage points over last year. Profit forecast and investment suggestions: We expect the company to achieve net profit of 382, 4.91, and 601 million yuan in 2018, 2019, and 601 million yuan respectively, with year-on-year increases of 22%, 28%, and 23%, respectively. EPS in 2018-2020 will be 0.20, 0.26, and 0.31 yuan/share, respectively. Maintain a “buy” rating. Risk warning: The smart medical business is progressing less than expected, and smart rail delivery orders are being executed more slowly than expected