[Third quarter results overview] Pacific Securities had revenue of 870 million yuan in the first three quarters, up 120% year on year; net profit attributable to parent company was 350 million, up 343% year on year; net assets of 6.2 billion yuan, up 184% from the end of 13; and total assets of 10.8 billion yuan, up 133% from the end of 13. EPS for the first three quarters of 13 was 0.11 yuan, and BVPS was 2.6 yuan. [Comment]: Brokerage business increased 12% year on year: Pacific brokerage market share in the first three quarters was 0.23%, up 0.01% from 2013; the commission rate for the first three quarters was 10.8 per 10,000, down 1/10,000 from last year; brokerage commission revenue was 210 million yuan, up 12% year on year. Self-operated business revenue increased sharply, up 288% year on year: Self-operated business revenue in the first three quarters was 410 million, a sharp increase of 288% year on year, mainly due to a sharp increase in the yield of self-operated business. The annualized profit of self-operated business reached 26.2% in the first three quarters. Asset management revenue increased significantly: Asset management revenue for the first three quarters was $40 million, a sharp increase of 282% over the previous year due to the low base effect in the previous period. Investment banking business increased 41% year on year: the company's investment banking business revenue in the first three quarters was 65 million yuan, up 41% year on year; a total of 1 IPO project was underwritten, totaling 190 million yuan; there were no fixed increase or allotment projects; and 12 corporate bonds, corporate bonds and convertible bonds were underwritten, totaling 3.47 billion yuan. The capital brokerage business has achieved rapid growth from nothing: the company's corporate finance business only started in 2014, but it is developing rapidly. As of September, the scale of the company's dual finance business reached 1 billion yuan; the scale of the equity pledge business in '13 was relatively small, and the equity pledge business in the third quarter of '14 (in terms of market value of uncompressed collateral) was 5.55 billion yuan, an increase of 1464% over the end of last year. Net interest income was $150 million, up 247% year on year. Management expenses increased 29% year over year: Due to a sharp increase in overall revenue and profit, Pacific Securities's management expenses reached 340 million in the first three quarters, up 29% year over year. Profit forecasting and investment advice: As a brokerage firm with a private background, the company maintains an open mindset in the Internet and other fields, and flexible mechanisms will help the company stand out in the future industry transformation process. The company's EPS for years 14 and 15 was 0.12 and 0.15 yuan, respectively, corresponding to 57 times PE and 47 times. Although the valuation is higher than the industry average, due to the removal of restrictions on innovative business, performance is expected to surpass the industry, and the private sector mechanism guarantees the flexibility of the company's operations. The company was given a “recommended” rating based on the above reasons. We think the company's reasonable value is 8.7 yuan, which is equivalent to 60 times PE in 15 years. Risk warning: The strategic transformation process that falls short of expectations will affect the company's valuation and long-term fundamentals; fluctuations in the secondary market will have a negative impact on the company's overall profit growth rate.