Performance growth was in line with expectations. High gross margin POCT reagent sales maintained rapid growth. The company's 2018 H1 revenue of 310 million yuan (+46.74%), net profit of 131 million yuan (+45.71%), net profit after deduction of 116 million yuan (+38.72%); on a quarterly basis, 2018Q2 had revenue of 166 million yuan (+40.08%), net profit of 640.59 million yuan (+31.45%), net profit of 56.8526 million yuan (+26.22%); The growth is in line with expectations. Although the growth rate declined slightly compared to the first quarter report, it was mainly due to the influenza epidemic in the first quarter, which led to a sharp increase in the company's inflammatory POCT testing business in the first quarter, while the influenza epidemic abated in the second quarter, so the growth rate of the second quarter report was slightly lower than the first quarter report. Also, in the second quarter, the company further expanded the market for cardiovascular and inflammatory POCT testing instruments and supporting high-margin POCT reagents, increased brand influence, strengthened sales management, and improved product quality, thus increasing business scale and revenue, leading to increased profits. Operating efficiency continues to be optimized, R&D investment accelerates, and new products are expected to increase the company's profits. 2018H1 The company's sales expenses are 59.2407 million yuan (+46.32%), mainly due to the continuous expansion of the company's sales market, the increase in staff remuneration, travel expenses, and sales staff equity incentives; management expenses of 54.1747 million yuan (+53.01%), mainly due to the increase in company personnel remuneration and R&D investment; R&D investment in the first half of the year (+53.07%); financial expenses - 215.09 million yuan (- 2345.02%), mainly due to an increase in interest income from capital raised; the company's operating cash flow was 64,358 million yuan (-7.49%), mainly due to the company's increased procurement and the increase in cash expenses during the period; the company's expenses did not affect the rapid growth in sales revenue. 2018H1, the company has completed the development and launch of a number of new products. The products currently on the market include the CM-800 fully automatic biochemical analyzer and its series of supporting reagents. The Getein1200 fluorescence immunity quantitative analyzer is scheduled to be launched on the market by the end of this year. In addition, the POCT series of thyroid-stimulating hormone test kits (colloidal gold/dry immunofluorescence) and neutrophil gelatinase-related lipid carrier/N-terminal natriuretic peptide precursor two-in-one test kit (dry immunofluorescence), luminescent myocardial reagent, Geinte3600 The quantitative biochemical immunity analyzer and its series of supporting reagents, the Getein 200 portable biochemical immunoassay analyzer and its series of supporting reagents are expected to enter the market next year. We expect that with the overall trend of import substitution in the future, the company's fully automated chemiluminescence tester MAGICL6800 will be launched on the market. The rapid increase in instrument sales and the steady increase in hospital terminal cardiovascular and inflammatory POCT business coverage and market share will lead to an increase in the volume of its related supporting reagents, thus further increasing the company's sales revenue and profit. Profit forecasting and investment advice As the leading cardiomyopathic POCT category in China, the company has huge room for import substitution and growth. We expect the company's 2018-2020 operating income to be 6.60/8.77/1,140 billion yuan, net profit of 2.65/3.55/463 million yuan, EPS of 1.42/1.91/2.49 yuan, and PE of 35/26/20 times, maintaining a “buy” investment rating. Give it 40 times PE in 2018, with a target price of 56.8 yuan. Risk warning: the risk of increased market competition, the risk of core technology being lost.