Matters Thirty-two natural person shareholders of Jinling Pharmaceutical, Nanjing Gulou Hospital, and Anqing Petrochemical Hospital signed the “Anqing Petrochemical Hospital Co., Ltd. Capital Increase and Share Transfer Agreement”. Jinling Pharmaceutical has invested 137 million yuan to hold 87.77% of Anqing Hospital's shares. The share transfer price corresponding to the original investment amount of 1 yuan is 8 yuan. After the share transfer, the share ratio was 87.77% for Jinling Holdings, 10% for Gulou, and 2.23% for some employees. Main opinion 1. Gulou Hospital's participation in management has increased the probability of success and bargaining power of Jinling's acquisition of the hospital. Anqing Hospital's 13-year operating income was 180 million yuan, and the net profit disclosed in the report was 2.87 million yuan. There is a lot of room for profit improvement. Jinling Pharmaceutical bought 87.77% of Anqing Hospital's shares with 137 million yuan. We think the purchase price is very reasonable. It can be seen that Jinling Pharmaceutical's model of introducing Nanjing Gulou Hospital Group as a technical partner for acquired hospitals is very attractive for cooperation with acquired hospitals facing development bottlenecks. 2. Anqing Petrochemical Hospital has obvious location advantages. A second restructuring can activate growth potential and promote profit release. We expect that the company's single-bed revenue will reach 500,000 to 600,000 yuan in the next 2 to 3 years, and the net profit contributed in 15 and 16 will be 100 million and 17 million yuan respectively (net interest rates are calculated at 5% in 2015 and 7% in 2016). Anqing Hospital strives to reach the level of a tertiary hospital in three to five years, and trains 1-2 specialists to become key specialties at the provincial level. Anqing Petrochemical Hospital is a second-class hospital. The hospital covers an area of 35,000 square meters, has 562 beds, 29 clinical and medical technology departments, and currently employs 737 people. In 2013, Anqing City had a total registered population of 6.2 million, with great consumption potential; Anqing Hospital is only a 3-hour drive from downtown Nanjing, and the Nanjing Gulou Hospital brand has strong radiative power in Anqing; Anqing Hospital is a designated medical insurance site and the only designated hospital for work injury rehabilitation; Anqing Hospital's burn and plastic surgery department is a discipline unique to Anqing City. Neurology, nephrology, surgery, otolaryngology, radiology, and endocrinology are key subjects and specialty disciplines in Anqing City, and the hospital has been further explored The foundation for improvement. 3. Investment suggestions: In the context of policies promoting the restructuring of public hospitals, I am optimistic about the medical service cooperation model of Jinling Pharmaceutical's export capital as the management party and the medical capital export power of Nanjing Gulou Hospital as the business manager. Taking into account Anqing Hospital's profit contribution, the EPS for 2015 and 2016 were raised to 0.02 and 0.03 yuan respectively. We predict that the company's EPS for 14-16 will be 0.36, 0.45, and 0.53 yuan, and the corresponding PE will be 40X, 32X, and 27X respectively, giving recommended ratings. Risk Tip 1. The advancement of new medical reforms is putting pressure on the pharmaceutical business 2. The health services business is progressing at a slower pace than expected