The decline in interest income and the increase in financial expenses reduced the growth rate of net profit of the mother, maintaining the “buy” rating. The company's revenue for the first three quarters increased 13.9% year on year to 53.76 billion yuan, and net profit fell 18.0% year on year to 390 million yuan. Gross operating profit increased 21.0% year on year, and operating margin increased 0.41 percentage points to 7.0% year on year, in line with expectations. However, financial deleveraging caused the company's interest income to decline and interest expenses to rise, resulting in lower net profit growth than expected. We believe that financial deleveraging may continue to put pressure on performance, but state-owned holdings are expected to strengthen the company's financial capacity, downgrade EPS in 18/19/20 to 0.21/0.35/0.38 yuan (previous value: 0.34/0.39/0.43 yuan) and maintain the “buy” rating. The endogenous growth of the 380 distribution platform is stable, and cash flow has improved. According to the revenue structure for the first half of '18, we expect the company's revenue growth to still mainly come from the increase in the business volume of the 380 distribution platform. In the first three quarters of 2018, the company's operating margin increased by 0.41 percentage points year on year. The gross margin for the second and third quarters of this year reached 7.21% and 7.09% respectively, the highest since 16 years, reflecting stable endogenous growth in the 380 platform. At the same time, the company's net operating cash flow has continued to be positive since the end of 2017, indicating that the 380 platform is gradually overcoming the operating management run-in period after rapid expansion, and the tight cash flow situation is easing. The financial deleveraging policy may be difficult to relax. It may continue to put pressure on the company's performance. The increase in net profit of the company's parent in the first three quarters fell short of expectations, mainly due to the decline in interest income and the rise in interest expenses. On the one hand, in the context of financial deleveraging, the company's subsidiary Yushang Financial Control Platform shrank its business scale, causing interest income to drop by 47.9% year on year to 220 million yuan; on the other hand, the company's financing costs rose 62.51% to 1.25 billion yuan. We believe that the financial deleveraging policy will not be relaxed in the short term and will continue to affect the company's supply chain financial business revenue and financing costs. The upgrade of Shenzhen Investment Control to the largest shareholder is expected to strengthen the company's financial capacity. On May 15 and September 9, respectively, Shenzhen Investment Control invested 1.82 billion yuan and 580 million yuan to obtain 13.3% and 5% of the company's total share capital. The transfer price was 10% off the closing price, surpassing Yatong Holdings (the share share fell to 17.85%) to become the largest shareholder. As a supply chain solution company, the company needs a strong capital drive to improve operating efficiency and accelerate capital turnover to achieve profit growth. After state-owned holdings, it is expected to help in terms of strategy and capital, or help improve the company's ability to obtain capital and reduce capital acquisition costs, and improve the company's profitability. State-owned enterprise holdings are expected to reduce financing costs, maintain the steady development of the “buy” rating company's 380 distribution platform, and improve cash flow, but financial deleveraging may put continued pressure on supply chain financial services and financing costs. The introduction of state-owned enterprise holdings is expected to reduce financing costs, improve profitability, or reduce the negative impact of financial deleveraging. The company's three-quarter report predicts a 20%-70% year-on-year decline in net profit for 2018. We lowered the company's profit forecast for 18/19/20 to 4.52/7.49/806 million yuan. Net profit for 2018 is expected to fall 24.1% year-on-year; the corresponding EPS is 0.21/0.35/0.38 yuan (previous value: 0.34/0.39/0.43 yuan). Based on the company's average PE valuation value of 32x-33x for the past 3 years, the corresponding target price was lowered to 6.72-6.93 yuan (previous value: 8.60-9.10 yuan), maintaining the “buy” rating. Risk warning: Too rapid expansion has led to tight cash flow; e-commerce businesses such as Ali and JD continue to deploy new retail, creating great competitive pressure.