Key investment performance is generally in line with expectations. In 2017, the company's operating income was 14.239 billion yuan, up 29.78% year on year, net profit was 264 million yuan, up 18.17% year on year, non-net profit of 264 million, up 19.60% year on year; in the first quarter of 2018, the company's operating income was 3.788 billion, up 25.00% year on year, net profit of 88 million yuan, up 23.54% year on year, non-net profit of 87 million yuan, up 22.66% year on year. The company's overall performance growth has remained steady and is generally in line with market expectations. The company announced a net profit range of 143 million yuan to 186 million yuan for 2018 H1, an increase of 0% to 30% over the previous year. Beijing's market share is expected to increase further, and the overall equipment and consumables business will remain stable. In 2017, Beijing's market revenue was 7.299 billion yuan, up 27.05% year on year, mainly due to the rapid increase in drug revenue after Sunshine Bidding, and the community side contributed significantly to the growth rate. The gross profit margin of the Beijing business was 8.40%, down 2.26 percentage points from the previous year, mainly related to the reduction in drug bidding prices. It is expected that with the implementation and promotion of the two-ticket system in Beijing, there is still room for increase in the company's market share. During the reporting period, the overall revenue of device sales platform companies Jiashi Weizhong and Jiashi Guorun was 2.133 billion yuan, up 51.44% year on year, and net profit was 308.336 million yuan, up 22.79% year on year. The revenue growth rate of other device distribution companies is expected to be over 15%, and the overall equipment sector has remained stable. Extension expansion continues, and changes in actual controllers bring new opportunities for development. In 2017, the company invested in Sichuan Jiashi Rongjin's strategic layout in the southwest region, with revenue of 556 million yuan and net profit of 11.1771 million yuan; the acquisition of high-quality companies Jiashi Shangyang and Jiashi Tonghan entered the IVD industry. Among them, Jiashi Shangyang mainly represented a number of cervical cancer-related products from US HOLOGIC (Holojie) and Paragon. Jiashi Tonghan was a second-level agent under OCD (formerly Johnson & Johnson Laboratory Diagnosis Company). In 2017, Jiashi Shangyang had revenue of 6.87 million yuan, net profit of 1.3 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan, net profit of 6.22 million yuan Profit was 1.06 million. Furthermore, Zhongqing Industrial Co., Ltd., a subsidiary of the company's former Central Group of Actual Controllers, transferred 100% of the state-owned property rights to Everbright Group. After the actual controller is changed, the company is expected to collaborate with Everbright Group resources to further enhance its business development advantages. Cash flow is a temporary sacrifice for business development. In 2017, the company's net cash flow from operating activities was -374 million, and 2018Q1 was -535 million. This was mainly due to the increase in the company's use of prepayment and cash methods to pay upstream suppliers in response to the two-ticket system in the pharmaceutical industry. In 2017, the company's financial expenses increased by 33.61% year on year, mainly due to the issuance of ABN and the increase in short-term bank financing. The financial expenses of 2018Q1 companies increased 114.17% year on year, mainly due to increased interest payable due to increased financing amounts and higher financing costs. risk factors. Bidding pressure to reduce prices, and upward pressure on capital costs. Earnings forecasts, valuations and ratings. The company's 2017 annual report and 2018Q1 performance are basically in line with market expectations. Through endogenous development and epitaxial expansion, the company has moved from regional to national. The high-value consumables distribution business is quite unique. Currently, the company's cash flow has been temporarily sacrificed for business expansion, and long-term development space is still worth looking forward to. The company's 2018-2020 EPS forecast was raised to 1.33/1.63/1.96 yuan (the original 18-19EPS forecast was 1.29/1.54 yuan), corresponding to PE 17/14/12 times, maintaining the “increase in holdings” rating.