Mergers and acquisitions began industry integration and comprehensively laid out the preschool education industry: Weichuang Co., Ltd. entered the preschool education industry in 2014 and carried out industry integration through acquisitions, forming a comprehensive, multi-level industrial layout centered on the four major brands of Hongying Education, Golden Cradle, Dingqi Preschool Education, and Kerr Education, and rapidly grew into a leading preschool education enterprise. Furthermore, the company continues to explore new business models such as the Antescu Project and the Ivy League Club to cultivate new business growth points and improve the quality of running schools and improving the quality of education. Build a preschool education ecosystem and start informatization transformation: the company adopts the “merger and acquisition+strategic cooperation” model, and realizes online and offline sector linkage through investment in homes such as Bei Chat and Dr. Cheng's childcare, and self-media traffic portals to establish a child growth ecosystem. We will also accelerate the expansion of the preschool education ecosystem by establishing strategic partnerships with specialized companies in various fields such as Kindergarten Teacher Pocket, Rui Yi, and Kerry Alliance. Furthermore, the company has now built a smart informatization base for children to grow up, has accumulated the advantages of big data, and will promote management and information transformation in the field of preschool education. Supported by a number of favorable policies, the industry has broad prospects: with the liberalization of the two-child policy, the number of newborns, enrollment rates, and kindergarten expenses have increased across the board, and the size of the preschool education market may reach 500 billion in 2020. Since 2010, the state has continued to promulgate a number of policies to encourage the development of preschool education. The influx of capital, resources and talents has brought impetus to the rapid development of the industry. In 2017, the “Private Education Promotion Law” was introduced. The return expectations for private education have become more clear, and the prospects are very broad. The traditional main business position is stable, and the preschool education business continues to be promising. For the first time, coverage was given a “recommended” rating: we expect the company's EPS from 2018 to 2020 to be 0.27/0.31/0.35 yuan, respectively, and the current stock price corresponding to 2018-2020 PE is 35/30/27 times, respectively. The company's traditional main business position is stable, and the scale and quality of the preschool education business continues to improve. With the gradual establishment of the preschool education ecosystem, the company's performance growth potential is huge, and for the first time, coverage was given a “recommended” rating. Risk warning: The integration effect falls short of expectations, policy implementation falls short of expectations, and industry competition intensifies.