The industrial chain is integrated to absorb high-quality brands, and the cooperative merger and acquisition model boosts rapid performance growth. In 2016, the company achieved operating income and net profit of 4,222 million yuan and 201 million yuan respectively, up 138.35% and 435.50%, respectively, from the previous year. The main business is electronic component distribution, software R&D, sales and maintenance, and R&D, production and sales of electronic intelligent controllers. During the reporting period, with the merger of Huashanglong Company, the company expanded and optimized component product lines and customers, strengthened the layout of customers in smart chips, new energy vehicles, security, intelligent rail transit, etc., absorbed many high-quality brands in the horizontal integration of the industrial chain, improved the comprehensive layout of the component product line, enhanced the depth of technical support and cooperation with industry customers, enhanced the company's own industry leadership position, and greatly increased the company's operating income. The company set up a special investment department to proactively attack and adopt innovative mergers and acquisitions models: join forces with Baijian Electronics, Skye, etc. to achieve strong alliances; increase capital in Hiweis to lay out the field of human-computer interaction and fingerprint recognition; invest in Shanghai Titanium Chain Electric and Huashang Vitai to seize the smart car market; and acquire joint Chuangtai to complete the IC industry pyramid layout. With the active advancement of the company's outreach strategy, the relevant benefits are gradually becoming apparent. Strengthen cost management, reduce costs and increase efficiency, and optimize asset structure. On the one hand, the company's risk control center actively promotes scientific control of the enterprise's production supply chain, and comprehensively controls the process flow, production schedule, process quality, material consumption, inventory management, etc., effectively improving production efficiency and product quality, and reducing sluggish inventory. On the other hand, the company has further improved the cost management system and management process, and achieved positive results. The company's sales expenses during the reporting period were 99.7643 million yuan, an increase of 106.56% year on year; however, due to strengthened cost control in the sales process, the ratio of sales expenses to turnover decreased by 13.55 percentage points; management expenses were 88,809 million yuan, an increase of 24.64% year on year; however, due to the company's increased cost control, strengthened internal management, and optimized the weaving structure, the ratio of management expenses to turnover during the reporting period decreased by 47.76 percentage points year-on-year. At the same time, in order to optimize the asset structure, the company divested Yingtang Digital and Yingtang Electric businesses. The company's scientific cost management and asset allocation plan will effectively improve the company's business quality and future profit potential. Release Yousoft Cloud, an industrial interconnection platform, to accelerate the construction of a vertical ecosystem for the electronic information industry. During the reporting period, the company released Yousoft Cloud, an Internet platform for the electronic information industry. Currently, Usoft Cloud mainly includes six major modules: B2B commerce, Usoft Mall, Youqi cloud service, financial services, public services, and membership services. Among them, Youqi Cloud Service is a cloud-based UAS system that provides low-cost access to enterprise management information systems. The system integrated the project management system and initiated the development of the MES-manufacturing execution system. Youqi Cloud Service fully supports mobile work. Up to now, the mobile app for mobile phones, UU Internet, has also been integrated into UU Cloud. As of the end of the reporting period, there were nearly 5,000 users on the Uosoft Cloud platform, and there were more than 3 million device types in the Uosoft Store standard device library. Enterprises use the creation of Usoft Cloud as an opportunity to accelerate the construction of a vertical ecosystem for the electronic information industry and accelerate the achievement of full industrial coverage. Profit forecast. The company's future highlights: 1) Strong reversal in performance, strong expectations for continued growth in the future. 2) The construction of the Internet platform “Yousoft Cloud” for the electronic information industry has been completed. We are optimistic about the company's vertical electronics industry “S2S” strategic layout. As the number of enterprise users gradually increases, it is expected to become a new performance growth point in the future. 3) In the context of the integration of the electronic components distribution industry, the company's foreign investment strategy has achieved remarkable results, product structure has been further optimized, competitiveness has been greatly improved, and its leading position in the industry has been consolidated. We expect the company's 2017-2019 EPS to be 0.29 yuan, 0.37 yuan, and 0.46 yuan, respectively. Referring to the same industry, Laimu Co., Heltai, and Hejing Technology's 2017 PE unanimous expectations were 53.12 times, 38.48 times, and 31.26 times, respectively. We gave the company 40 times PE in '17, with a target price of 11.60 yuan, and a “buy” rating. Risk warning. Company transformation falls short of expectations; downturn in the economy risks.