Key investment matters: The company announced its 2015 annual report and 2016 quarterly report on April 1**** An's view: The annual report and the first quarter report net profit grew rapidly: the company's 2015 operating income was 360 million yuan, net profit was 65.37 million yuan, up 21.27% and 58.07% year on year. In the first quarter of 2016, revenue increased 91.13% year on year to 102 million yuan; net profit of the mother increased 124.78% year on year to 9.11 million yuan. The rapid increase in the company's net profit in the two reports was due to the rapid development brought about by the company's endogenous and external development. In August 2015, the numbers of Tang people began to merge. At the same time, at the level of endogenous growth, the company's new public security products, which had been popular for a long time, began to receive large-scale orders, and the company's network content audit and supervision products in the field of operator customers also received good growth. It is worth mentioning that the quarterly report still increased 124.78% year on year despite the reduction in government subsidies included, proving the rapid development of the company's new public security business. Gross margin is expected to continue to rise: The company's gross margin has been rising steadily since 2013, from 51.14% to 65.27% in 2015. On the one hand, the gross margin of the game company Tangjin is close to 100%. On the other hand, due to the company's new products and solutions in the field of public security not only have high product margin, but also include a considerable amount of local big data analysis software in the solution, the company's gross margin has gradually increased. Since the development of the new field of public security should be faster than that of other businesses, the company's gross margin level is expected to continue to rise in the next two to three years. The market for online content, behavioral auditing, and supervision is developing rapidly: In 2010, China's online content and behavior audit market was only 640 million yuan. The market size is expected to reach 2.18 billion yuan in 2015, with an average compound annual growth rate of 27.22%. In the future, the security issues of network behavior and content will become particularly prominent: with the continuous growth of cloud networking applications and the popularity rate of netizens, as well as the rapid development of five computing and “cloud networking plus” software as a service, the cloud network computer room side and the user's broadband access end are developing at a rapid pace. In the future, network behavior and content security issues will become particularly prominent. With the establishment of a national security strategy in 2015 and the gradual implementation of anti-terrorism laws during the “13th Five-Year Plan” period, investment in the field of offline public safety to online public safety and information security is expected to increase year by year. Supervision will be further strengthened, keeping the prosperity of the information security sub-industry in cloud network information supervision and public opinion monitoring at a high level. We are optimistic about the company's rapid development in 2016 and the next two years: on the one hand, the public security system is in the “13th Five-Year Plan” investment period, and the company is also creating this digital security market, which will occupy 25-40% of the market share. Second, the company plans to vigorously promote the sales of cybersecurity equipment in 2016. The company's network content and behavioral monitoring equipment are the same source as well-known cybersecurity equipment. The hardware indicators of the company's equipment are leading in the industry, and the company has customer resources that must be autonomous and controllable in key industries such as military, public security, medical care, and finance. In this sub-industry with an average annual growth rate of 30%, the company will definitely achieve growth exceeding expectations. Profit forecast: The company's revenue for 16-18 is expected to be 7.89, 10.45 and 1,389 billion yuan, and EPS for 16-18 is 0.51, 0.66, and 0.86 yuan respectively, corresponding to the closing price on the 19th. PE for 16-18 is 69.6, 53.6, and 41.1 times, respectively, maintaining the “recommended” rating. Risk warning: Investment in mobile terminal regulation falls short of expectations.