For the first time, investment highlights covered Xinli Financial Company (600318), which gave a neutral rating, with a target price of $33.32, based on the successful acquisition of Haike Rongtong and the SOTP segment valuation. The reason is as follows: Relying on the background of the Anhui Supply and Marketing Agency to create a “payment+loan” platform. The five major leasing/small loans/pawnbroking/guarantee/P2P lending businesses all rank among the top in the province (leveraging loan balance to 7 billion yuan in 2016), and they plan to increase payments through the acquisition of Haike Rongtong (600 billion billion+ offline turnover in 2016; market share of ~ 3%). The payment/lending business is expected to account for 62%/38% of revenue and 56%/44% of net profit in 2018. Payment business: Channel sinking to expand the merchant base, credit superposition explores merchant value. Offline POS transactions have entered the silver era (16 to 20e flow CAGR ~ 19%), and declining rates and the mobile revolution will accelerate the reshuffle of the industry. With a focus on small misplaced competition, market expansion in the agency model, and resource advantages of deep cooperation scenarios, Haike Rongtong expects payment business revenue of 16 to 18e to 27%. Lending business: unique customer acquisition advantages, stable risk control strategies, and good bank-enterprise relationships. The company's steady management with state-owned platforms and enterprising employee ownership of listed companies will fully benefit from the development dividends of micro credit and rural finance (currently leasing/small loans/pawnbrokers' respective target market shares are only ~ 0.05%/2.3%/5.0%), and the lending business is expected to have a revenue CAGR of 17% to 17%. Three major collaborations: channel (city+rural), business (payment+loan), risk control (POS flow+offline outlets). The payment portal (covering 2.5 million+ merchants, controlling transaction flow) helps merchants in the loan business obtain and strengthen risk control; the group scenario (provincial supply and marketing agency ~ 64,000 outlets) promotes the accelerated implementation of payments in Anhui, using this as a testing ground to explore comprehensive financial services in townships and rural areas, and then to the whole country. What is our biggest difference from the market? Remain relatively cautious about the offline POS billing market space; the synergistic effect of the company's “payment+loan” dual-wheel drive is yet to be further observed. Potential catalysts: asset restructuring meetings; off-site expansion of leasing business; completion of shareholder holdings reduction. The profit forecast and valuation estimate that the company's EPS for 16-18 will be 0.74/0.83/0.98 yuan, respectively, and the CAGR will be 15%. Assuming that the acquisition of Haike Finance and supporting financing is completed and consolidated from July '17, the 16-18 EPS is 0.45/0.82/1.42 yuan (CAGR: 78%), respectively (CAGR: 78%) under a total diluted share capital of 396 million yuan, we arrive at a valuation of 13.2 billion yuan based on SOTP (corresponding target price of 33.32 yuan and 23x 18e P/E). Risk asset restructuring has failed, and competition for third-party payments has intensified.