Zhongjiang Real Estate became Jiuding's A-share listing platform after Jiuding invested 4.2 billion yuan in May of this year, and announced in September that it plans to acquire all of Jiuding's private equity investment business assets, Kunwu Jiuding, and also released a 12 billion refinancing plan to increase private equity business. It plans to drastically increase the size of the company's managed funds from the current 33.2 billion to 78 billion within 3 years. In the future, Zhongjiang Real Estate will become the only operating platform for Jiuding's PE business, and form a dual business development model with parallel levels of real estate and PE in China; book In the context of the market and the era of “mass entrepreneurship and mass innovation,” we believe that Zhongjiang Real Estate (Kunwu Jiuding), as a leading enterprise in the domestic PE industry, is expected to benefit to the greatest extent from the growth in the scale of the domestic industry and the rise in market share. Taking into account the company's future fund management scale, the potential space of the real estate fund business, and the characteristics of scarce types of A-shares, and also referring to the valuations of comparable listed companies at home and abroad, we gave Zhongjiang Real Estate a target price of 49.00 yuan/share, predicting that the company's earnings per share for 2015-17 were 0.29, 0.32, and 0.39 yuan, covering the first time a buying rating. Key points supporting ratings Jiuding invested in Zhongjiang Real Estate, and its core PE business was listed on A-shares. In May of this year, Jiuding invested 4.15 billion yuan to win 100% of the shares of Zhongjiang Group, the controlling shareholder of the company. In September, Zhongjiang Real Estate announced that it plans to use 9100 million yuan in cash to acquire 100% of Kunwu Jiuding's shares held by Jiuding Investment, and the private equity investment business of Jiuding Investment will all be carried out through Kunwu Jiuding. If this restructuring is implemented, Zhongjiang Real Estate will become the only platform for Jiuding Investment to carry out private equity investment business. It is determined to increase the PE business, and the scale of forward fund management will reach 78 billion dollars. At the same time, the company announced a fixed increase plan of 12 billion dollars to increase PE business. As of May of this year, the pledge scale of funds under management by Kunwu Jiuding is 33.2 billion yuan, and the comprehensive IRR for projects that have been withdrawn is 33.21%. If this fixed increase is successfully implemented, the company will add 48 billion yuan in managed funds, the fund management scale will reach 78 billion yuan within 3 years, and the compound growth rate over three years will reach 33%, and with the financing function of A-shares, the company's subsequent scale growth is worth looking forward to. Venture capital investors will continue to benefit from favorable policies over the next six months. In the context of China's construction of a multi-level capital market and the era of “mass entrepreneurship and mass innovation,” the domestic private equity investment industry is developing rapidly. In the next six months, with the acceleration of processes such as the registration system plan, the new three-board transition board, and the establishment of a strategic new board and science and technology innovation board, etc., the scale of the PE industry will continue to expand, and Zhongjiang Real Estate (Kunwu Jiuding), as the leader in the PE industry, will fully benefit from the explosion of the industry and the increase in market share. The “real estate+PE” dual main business is developing, and there is huge room for synergy. Zhongjiang Real Estate used the acquisition of Kunwu Jiuding as an opportunity to enter the PE management industry and achieve diversified business development. Since real estate and private equity investment management are both industries highly related to the scale of capital, Jiuding's investment management business is expected to form an effective link with the company's current real estate business, and there is huge scope for potential cooperation, such as real estate fund cooperation, and cooperation with Jiuding's real estate equity and debt assets. The main risks faced by ratings The risk of approval of asset restructuring plans or implementation progress fell short of expectations. The valuation comprehensively considers the company's future fund management scale, the potential space of the real estate fund business, and the characteristics of scarce varieties of A shares. Also referring to the valuations of comparable listed companies at home and abroad, we gave Zhongjiang Real Estate a target price of 49.00 yuan/share, and predicted that the company's earnings per share in 2015-17 would be 0.29, 0.32, and 0.39 yuan, covering the purchase rating for the first time.