Event: The company released its 2017 performance forecast: Net profit attributable to listed companies in 2017 was 184 million yuan to 244 million yuan, an increase of 50%-100% over the previous year, in line with previous expectations. Key investment points: APIs and formulations are driven by a two-wheel drive, and performance continues to grow at a high rate. Since 2016, the company's net profit has clearly increased in size, and this year's performance has continued to grow at a high rate. We believe this is related to the significant increase in profitability due to the increase in the price of APIs and the increase in the price of generic drugs. Prices of the company's main raw materials and drugs all increased in 2017. Since mainly long-term orders were signed, considering the current stricter environmental protection and lagging effects, there is still room for long-term order prices in 2018. However, in terms of pharmaceuticals, the current scale of the six major strategic varieties is still small and mainly relies on generic drugs, but we believe that with the expansion of sales areas and team expansion, marketing strength is expected to continue to improve. There is plenty of room for improvement in scale and profit over the long term, and the company's performance is expected to continue to grow rapidly in the next three years. The consistency evaluation is progressing smoothly, and the implementation of fixed increases has been completed to inject vitality into the enterprise. The company has been promoting the consistency evaluation work and sorted out the key varieties. Currently, there are 9 varieties in BE. Considering the competitive situation of these varieties, we expect that after the consistency evaluation is successfully completed, we expect a situation where volume and price will rise sharply due to the company's brand and quality advantages, providing strong support for the growth of the company's pharmaceutical business. However, the company successfully completed a fixed increase in October of this year and successfully introduced an employee stock ownership plan. Although the amount was small, it was conducive to the unity of interests between the enterprise and employees. Also, considering the company's incentives for R&D and process improvement and subsequent talent plans, it injected vitality into the company's development. Maintain a “Recommended” rating. We maintain our previous forecast. The 2017-2019 EPS is expected to be 0.41 yuan, 0.56 yuan, and 0.69 yuan respectively. The current valuation level is slightly lower. Considering the company's expectations of rising API prices and the continued growth trend of formulations, we maintain a “recommended” rating, and are optimistic about the company's development over the long term. Risks suggest that pharmaceutical sales are slower than expected; costs are rising faster than expected; bidding pressure to reduce prices, etc.