Main business growth was steady, and cash flow continued to be stable. The company achieved operating income of 580 million yuan in 2016, an increase of 16.45% over the previous year; net profit was 400 million yuan, a decrease of 2.42% over the previous year. In order to cope with the increase in traffic flow, the company combined traffic pressure at various toll gates to promote toll gate expansion and construction of new weighted lanes in an orderly manner to further enhance toll gate traffic capacity. In the first half of the year, toll traffic was 36.33 million, an increase of 17.55% over the previous year; toll revenue was 478 million, an increase of 8.48% over the previous year. The performance of Dongguan Securities, which participated in the reporting period, declined sharply due to the boom in the industry, and the investment income contributed by associated companies fell by 45.79%, in line with our previous expectations. The steady development of the main business has made up for the impact of the decline in investment income and provided sufficient and stable cash flow for the transformation of financial control. The leasing business grew rapidly, and business collaboration promoted development. The company's leasing business maintained rapid growth. In the first half of the year, the company achieved revenue of 91 million yuan and net profit of 43 million yuan, up 101.34% and 73.5% year-on-year respectively. During the reporting period, the company strengthened the refined management of the business team, implemented targeted marketing and promotion activities, and further built a rich marketing channel; at the same time, it continuously improved the construction of a risk control system to reduce the risk of running the entire leasing project process. The company also plans to jointly initiate the establishment of Hongtong Commercial Factoring Company with Guangdong Hongchuan Group in Tianjin's Binhai New Area, with a registered capital of 500 million yuan, of which Dongguan Holdings will invest 475 million yuan and hold 95% of the shares. Using shareholder resources, Hongtong Commercial Factoring will carry out factoring business with Dongguan Holdings around road and bridge project receivables and warehousing enterprise supply chains, and achieve resource sharing, cross-marketing, and collaborative development with Rongtong Leasing in terms of customer resources, marketing, risk control, etc., to improve the yield and market competitiveness of the financial leasing business, and reduce the liquidity risk of the financial leasing business. A fixed increase in capacity and capacity to improve strength. The prospects for regional financial control are broad, and the development momentum of integrated leasing, which is owned by the company, is strong, and capital demand is strong. The company plans to raise capital of no more than 1.4 billion yuan through a non-public offering to increase financing and leasing. Currently, the plan has passed, and is yet to be formally approved. After the fixed increase is completed, the registered capital of Rongtong Leasing will double, and it is expected that performance will be increased in 2017. The employee stock ownership plan, which is one of the targets of fixed increases, is locked for a period of 3 years to harmonize the interests of employees and the company, and effectively stimulate enthusiasm. Dongguan Securities, in which the company is a shareholder, is in the IPO queue, and is expected to bring considerable investment returns after listing. The company also has shares in Dongguan Trust, Chang'an Village Bank, and Songshan Lake Small Loan Company, all of which are actually controlled by the Dongguan State Assets Administration Commission. As the only listing platform under the Dongguan State-owned Assets Administration Commission, benefiting from the accelerated progress of state-owned enterprise reform, the company is expected to transform into a local financial control platform and will likely undertake the collaborative development of industry and finance under the Dongguan State Assets Administration Commission. Optimistic about development prospects and maintaining the “increased holdings” rating We are optimistic about the company's “dual drive of production and finance” development strategy and the development prospects of transformational finance. Our main business is growing steadily and continues to bring stable cash flow. The imminent implementation of a non-public offering will supplement the high-growth leasing business with capital, and the commercial factoring company to be established will also promote the integration of the company's internal resources, improve operating efficiency, and further accelerate the financial layout. The acceleration of state-owned enterprise reform is expected to drive the transformation of companies into local financial control platforms and serve the development of regional industries. We expect EPS in 2016-18 to be 0.6, 0.73, and 0.94 yuan respectively, corresponding to PE 17X, 14X, and 11X, with a target price range of 11.58 to 13.49 yuan, maintaining the “increased holding” rating. Risk warning: the fixed increase process falls short of expectations, the national reform process falls short of expectations, the Dongguan securities IPO process falls short of expectations, risk of market fluctuations