Main points of investment:

Complete major asset restructuring and build a two-wheel drive business model. In 2017, the company completed the major asset restructuring of the acquisition of Shenyun House. After the completion of the acquisition, the company has become a two-wheel drive business model of modified asphalt business and real estate intermediary service business. Shenzhen Yunfang is a real estate intermediary service provider with O2O model as the core, mainly engaged in new housing agents and housing brokerage business. Deep Yunfang not only continues to cultivate in key first-and second-tier cities (including Shenzhen, Shanghai, Guangzhou, Beijing, Zhuhai, Zhongshan, Suzhou, Hangzhou, Nanjing, Qingdao, etc.), but also continues to deepen the breadth and density of offline marketing outlets, it also actively expand the potential of second-and third-tier cities (including Chengdu, Wuhan, Kunming, Yantai, etc.).

"Deep ploughing" and "expansion" should be carried out at the same time to develop housing rental business. After the completion of the restructuring in 2017, Shenyun Housing actively carried out deep ploughing and expansion strategy, and plans to open up the rental market in 2018. The feasibility announcement on the establishment of long-term rental apartment, marketing network and O2O system issued by the company on May 3 plans to invest a total of 1.562 billion yuan to build the competitiveness of the stock housing market business around the above three aspects. We believe that the restructured Guochuang Hi-tech gives Shenyunfang strong capital support, so that it can make use of the strength of the capital market, give full play to its own platform advantages, actively improve trading platform services and expand leasing market business. We believe that the company is gradually implementing the vision of "becoming a real estate Internet trading platform for the national real estate industry to provide online and offline (O2O) omni-channel marketing solutions".

The excellent performance of real estate intermediary services has become a new driving force for performance growth. In 2017, the company achieved an operating income of 2.573 billion yuan (of which 22 million yuan was interest income), an increase of 291.21% over the same period last year, of which the revenue of the real estate intermediary service business was 1.619 billion yuan; the company's operating profit was 65 million yuan, an increase of 435.51% over the same period last year; the net profit belonging to shareholders of listed companies was 43 million yuan, an increase of 727.87% over the same period last year The main reason for the growth in performance is that the good operating performance of Yunfang in Shenzhen has led to a substantial increase in the overall operating performance of the company. According to the announcement of the completion of the performance commitment announced by the company, the net profit of Shenyunfang is 272 million yuan, which is 5.62% higher than the promised performance. (the performance of Shenzhen Yunfang since August 2017 has been included in the annual performance of Guochuang High-tech in 2017. )

Investment suggestions to "increase holdings". The actual performance of Shenyun Room in 2017 exceeded the performance commitment. If the performance of Shenzhen Yunfang reaches the promised level in 2018, the year-on-year growth rate of net profit should be about 18.6%. Considering that the company only showed the 4-month performance of Deep Cloud House in 2017, we believe that the performance will still double after the country created high-tech and completely expressed Deep Cloud House in 2018. According to the total existing share capital, we estimate that the company's EPS in 2018 is 0.34 yuan per share (with reference to the performance commitment of Deep Cloud Housing, it is predicted that the 18-year net profit will mainly come from Deep Cloud Housing). Considering that the company plans not to issue A shares more than 1.2 times the total share capital, we predict that the EPS will be 0.29 yuan in 2018 after the additional offering. The company's closing price on May 9 was 7.66 yuan, which was about 22 times higher than that of 0.34 yuan EPS in 2018. With reference to the comparable company valuation, we give the company 25 times PE in 2018, corresponding to a target price of 0.34 to 258.58 yuan. Give a rating of "overweight". Risk tips: 1) dilution of EPS after the non-public offering of A shares; 2) it remains to be seen to raise funds for the construction of the real estate trading platform and rental housing market; 3) the competition in the rental market is fierce, and the investment to expand new business does not achieve the expected return.