Key investment companies achieved operating income of 20.81 billion yuan in 2017, an increase of 0.14% over the previous year, net profit attributable to shareholders of listed companies of 1,947 billion yuan, an increase of 92.55% over the previous year, and an EPS of 1.14 yuan. Performance promises were fulfilled, and sales performance was outstanding. Reasons for the rapid growth rate of the company's net profit during the reporting period: 1. Investment return increased sharply: the company completed the transfer of 100% equity and bonds to Jiangsu Dongheng Haixin Real Estate in November '17, increasing net profit to the mother by about 940 million yuan; 2. The net profit and loss ratio of minority shareholders fell by 10.3 percentage points year-on-year due to the increase in the equity ratio of settlement projects during the reporting period; 3. Further strengthening of cost control capabilities: The company's sales management expenses rate in 2017 was 4.27%, narrowed by 0.0.2% year on year 59 percent points. After the actual completion of the company's restructuring of the farm housing group and farm housing purchase from 2015 to 2017, the net profit deducted from non-return to the parent was 36.9 million yuan and 306 million yuan respectively. The cumulative completion rates were 105% and 311%, respectively, and the three-year restructuring performance promise was exceeded. In terms of gross margin, the company's 2017 settlement gross margin narrowed by 0.52 percentage points year-on-year due to the carry-over structure, but as projects in core cities in Shanghai, Jiangsu and Zhejiang enter settlement one after another, we expect the company's gross margin to recover upward in 2018. In terms of sales, the company achieved contracted sales volume of 23.662 billion yuan and contracted sales area of 2.1853 million square meters in 2017, with year-on-year increases of 24.98% and 14.63% respectively, with a sales payback rate of 98%. Looking ahead to 2018, the company's saleable value is abundant, with a promotional value close to 40 billion yuan, 70% of which is concentrated in the Yangtze River Delta region (estimated according to the annual report project schedule). We believe that the company's sales are expected to achieve steady growth this year. Diversified methods expanded resources. The financial structure was further optimized. During the reporting period, the company fully integrated the resource advantages of all parties and actively expanded resources through diversified methods such as guaranteed housing projects, urban village renovation, urban renewal, rental housing, mergers and acquisitions, etc. In 2017, 9442,500 square meters of land storage were added, an increase of 78.67% over the previous year. Among them, bidding accounted for 72%, and mergers and acquisitions accounted for 28%. Judging from the land acquisition structure, the new land reserves are mainly distributed in Shanghai and surrounding second- and third-tier cities, with the Yangtze River Delta accounting for 90% (in terms of amount). In terms of finance, the company's leverage ratio has declined through active financial operations. The company's net debt ratio at the end of 2017 was 133.36%, down 22.21 percentage points from the end of 2016. In terms of financing costs, the company has further reduced financing costs through diversified financing channels and the endorsement of state-owned assets in Shanghai, such as issuing 1.5 billion securities in August 2017 (interest rate of 5.15%), successfully issuing 880 million yuan of CMBS in February 2018 (interest rate range of 5.99% to 6.99%), and applying for registration of no more than 3.5 billion yuan of perpetual bonds. The company's overall average financing cost at the end of 2017 was 5.35%, down 1.2 percentage points from 2016. Diversify business development and accelerate collaboration and integration between industries. The company has made every effort to build a cold chain logistics industry chain through resource integration with Haifu Logistics Group. Currently, the company has large-scale bonded room temperature warehouses and cold chain logistics parks in key development areas such as Yangshan Free Trade Zone and Dahongqiao. Other areas in the city also have operating resources such as large-scale cold storage, room temperature warehouses, wharf shoreline, BH city freight taxis, and refrigerated vehicles. 1. Logistics sector: focusing on the cultivation of the “cold chain industry chain” and comprehensively constructing a development pattern of technological innovation, structural optimization and industrial chain extension; 2. The supply chain sector: through the unique “clubhouse entity” business model “**** 919” project, can provide personalized services to dealers; 3. The vegetable manager sector: actively exploiting the advantages of its own cold chain distribution e-commerce platform, using the diversification of the real estate industry, urban services and the Internet as a breakthrough, serving a one-stop platform for real estate sales, commercial management and property services. Profit forecasting and investment rating companies developed rapidly. Sales continued to grow at a high level in 2017, while the cold chain logistics business had plenty of room for development. The company is rich in land reserves, with Shanghai as the core, and is actively expanding into surrounding second- and third-tier cities. We expect the EPS in 18/19 to be 0.90 yuan and 1.00 yuan, and the corresponding PE multiples are 7.30X and 6.57X, maintaining the “buy” rating. Risk warning events: Company sales fall short of expectations, industry regulation, and continued tightening of liquidity, etc.