Event: The company held the 21st meeting of the fifth board of directors on August 10, 2020, and elected Mr. Liu Junjun as the chairman of the fifth board of directors of the company. The founder of Megem is the chairman of the board. Mr. Liu Junjun is one of the founders of Megem. Before the company acquired Megem, he owned 31.86% of Megem's shares. He held a total of 60.05% of Megem's shares as co-actors with Liu Yi and Wang Yan, and was the controlling shareholder and actual controller. Currently, Liu Junjun directly and indirectly holds a total of 2.30% of the company's shares. With Liu Yi, Wang Yan, and Tianjin Megley as co-actors, he holds a total of 6.34% of the company's shares. Mr. Liu Junjun has been the general manager of Megem since 2013, and the director and general manager of the company since January 2019. This time, he is the company's chairman, reflecting the company's determination to develop the early childhood education business. Divestment of the original main business and focus on the education industry. The company plans to transfer 100% of Sanlei Technology's shares to Mr. Yu Jianmo and Mr. Jin Bingduo for 249 million yuan. Mr. Yu Jianmo and Co-Actors were the actual controllers of the company (formerly known as Third Base Shares) until November 2016. Currently, Mr. Yu Jianmo and Co-Actors hold 22.31% of the shares, and Mr. Kim Byeong-duo holds 3.83% of the shares. After the company divests its original main business, it will become a pure education company, which is conducive to business focus. H1 has been affected by the pandemic, and H2 is expected to improve. Early childhood education targets a younger customer base, and the resumption of work and classes is later than in other education segments. Megim has only resumed classes one after another since May. Currently, more than 360 centers have resumed classes. It is expected that the progress of store operations and expansion will improve markedly in the second half of the year. The pandemic is expected to accelerate the clearance of small institutions in the industry and the process of industry integration. Megim may benefit as a leader in early childhood education. Investment advice: The founder of Megem is the company's chairman. In addition to the previous announcement to divest the original main business, it reflects the company's determination to focus on early childhood education business. Consider the investment income brought about by the transfer of Third Base Technology, maintain the profit forecast of net profit of 246/1.80/205 million yuan from 2020 to 22, with a corresponding valuation of 23x/32x/28x, and maintain the “buy” rating. Risk warning: After the early education network resumed classes, the willingness of parents and students to attend classes fell short of expectations, and the progress of branch expansion fell short of expectations. The study abroad business has not met expectations due to the impact of the overseas pandemic.